
-3k 


W 


if* 


'fM 


f^ 


^ 


M 


1 


0i 



^ht> 



?^J 





s 


i 




^ 




H^ Of-^St^/Tr^^P*^ A^i! A 


wi^^ 


^^ 


^S^-SifSR 


^^^ 


•3i^ 




S 


^Cj 


^ij?27?l^MMlj^?F' ' 


^^^ 




^^^ 


^M 


^ 






:^^ 



l"?^? 



M 


^ 


§0 


p 



1 



BY THE SAME AUTHOR. 



THE DISTRIBUTION OF PRODUCTS. Or, The 

Mechanism and the Metaphysics of Exchange, Three 
Essays : 

What Makes the Rate of "Wages ? 

What is a Bank ? 

The Railway, the Farmer, and the Pl"blic. 

Second edition, much enlaiged. Octavo, pp. v. + 365 . $1 50 

" His remarks on the legislators of the country are vigorous and refreshing. 
The book, notwithstanding its statistics, is exceedingly interesting and is the 
ablest defense of capital that we have seen." — Ciscajcc Advance. 

THE MARGIN OF PROFITS. How Profits are Now 
Divided ; What Part of the Present Hours of Labor can 

Now be Spared. Together with the reply of Mr. E. M. Chamterlin, 

representing the Labor Union, and Mr. Atkinson's rejoinder to the 

reply. (No. XL. of "The Questions of the Day Series') 

Cloth, 75 cents . paper ...... 40 cents. 

" This volume abounds in facts and statistics of first importance, and no 
student of the economic problems of the day should fail to give it a careful read- 
ing. — Boston TraveUer. 

G. P. PUTNAM'S SONS, Pitblishers 
NEW YORK AND LONDON 



AUG 



rr?r- 



THE INDUSTRIAL PROGRESS 
OF THE NATION 



CONSUMPTION LIMITED, PRODUCTION 
UNLIMITED 



BY 

EDWARD ATKINSON, LL.D., Ph.D. 
u 

AUTHOR OF "the UISTKIBUTION OF PRODUCTS," "THE MARGIN OF PROFITS," ETCl 




G. P. PUTNAM'S SONS 

NEW YORK LONDON 

«7 WEST TWENTY-THIRD ST. 27 KING WILLIAM ST., STRAND 

®^e ^ntckcrboclur ^rcss 



COPYKIGHT nv 

G. p. PUTNAM'S ^ S ^ 

[AUG 30 liM' 

C«py 



Zbe Tftnicfterbocftcr iprcsa 

Electrotyped and Printed by 
fr. p. Putnam's Sons 



HBjvi 
• 7 
./\87 




PREFACE. 



I VENTURE again to present to the public two series of articles 
which have ai)peared, one in The Century Magazine, and one in 
The Foru7n. I have made such slight corrections as have been 
found necessary. I have continued the statistics which have been previ'^ 
ously published down to the present date and I have added some other 
treatises not previously published, notably the Address, given to the 
graduating class of the University of South Carolina in which I have 
given very fully the motive of my work. 

I began the investigation of our national accounts early in the year 
1862, wishing to demonstrate the ability of the Nation to bear any 
amount of taxation which might become necessary for the maintenance 
of the national existence. At that time my own concepts of the great 
problems in social science which I have since undertaken to treat, 
were very vague and indefinite ; I held, however, a profound con- 
viction — 

I St. Tliat the purpose of human life ujjon earth could only be the 
development of the character and capacity of the individual tli rough 
the very struggle for material existence which seems to be so arduous. 

2d. That mind and character must be the paramount factors in 
material production. 

3d. That there must be a higher law leading through the correla- 
tion of mental and material forces toward an amjjle and abundant sub- 
sistence and toward an equitable distribution. 

4th. I held the profound conviction that these conditions of 
material welfare could only be attained by the develojiment of indi- 
vidual intelligence, leading to the conception that in all commerce 
among men both parties serve each other. 

5th That whenever the interdependence of men and of nations 
should become a part of the common knowledge of the people, peace, 
order, and industry would be adopted as the common law and practice 
of nations. 

6th. As I have explored each branch of material ])roduction, it has 
become more and more apparent to me that the earth's capacity to sus- 



iv Preface. 

tain life has hardly yet been touched, and I have come to the definite 
conclusion that, while the power of mankind to consume the products 
of the earth is limited, the source from which man may draw satisfac- 
tion for his material wants is practically unlimited. 

When it first became apparent to me that the subject of our domestic 
commerce as well as of our foreign commerce must be limited substan- 
tially to the exchange of the product of each series of four seasons 
constituting one year, and that by so much as the few might attain a 
greater share of this product must others enjoy less, the conception 
that poverty might be a necessary correlative of progress in wealth 
under the competitive system for a time led me to question the equity 
of the present methods of distribution. 

This is, however, a very superficial view. To any one who searches 
thoroughly, it very soon becomes apparent that the competition of 
capital with capital, — of owner with owner, — of wealth with wealth, — 
tends to the reduction of profits to a minimum, while at the same time 
the use and application of capital under the direction of competent 
owners or agents increases the product perhaps in even tenfold greater 
measure than the share of such increase which the capitalist secures 
either in the form of rent, interest, or profit. Hence it follows of 
necessity that the share of the annual product which falls to the 
capitalist must be almost in inverse proportion to the efficiency of the 
capital which he directs. In other words, as capital increases in its 
productive efficiency it becomes a factor in developing a constantly 
increasing product, of which a lessening part is secured to its owners. 
On the other hand, so long as workmen gain in intelligence and skill, 
they must of necessity secure to their own use and enjoyment a con- 
stantly increasing share of this steadily increasing product. 

It therefore follows that each man may be held to make his own 
rate of wages as well as his own rate of profits by the measure of 
individual intelligence and aptitude which he is able to devote to the 
occupation in which he is engaged. 

The unequal distribution of the annual product therefore becomes 
equitable ; the only condition precedent being, that the government 
should not intervene either by direct or indirect taxation so as to divert 
the increasing product which is due to science and invention, either to 
the destructive purposes of war or to the preparation for war, or to the 
support of privileged classes. 

Whether or not such has been the effect of taxation on the 
debt- and army-ridden nations of Europe, may perhaps be indi- 
cated by the two studies on the " Relative Weakness and Strength of 
Nations." 

As these conclusions were gradually developed in part a priori and 
in part from observation of existing facts and figures, the true function 



Preface. v 

of statistical investigation assumed a new importance, and in the light 
of these theories the following studies have been prepared. 

This conception of the mutual interdependence of men, and that 
the necessary relation of mutual service is the condition of general 
welfare, led of necessity to the conclusion that all trade and commerce 
should be free from any artificial obstructions created by law, except 
the regulation of noxious or unwholesome occupations on special 
grounds. 

It may happen that those who are ready to accept the logical con- 
clusions which are developed by the study of the national accounts and 
the statistics of international commerce, may be obliged to surrender 
their inherited ideas in respect to the proper functions of government, 
and may come to the conclusion that commerce should be free from 
any and all taxation except so far as the necessity of government for 
a revenue on foreign imports may render it necessary to impose taxes 
thereon. 

Whether I have succeeded or failed in impressing these views 
upon my readers, each one must judge for himself. If I shall have 
given a direction to the thought and life of the younger men of the 
present generation who are about to enter upon its arduous and busy 
duties, to the end that their conception of the meaning of life and their 
own enjoyment of life, of work, and of men shall be increased in the 
measure which I have succeeded in attaining for myself by the pursuit 
of these studies, then I shall have accomplished my purpose and shall 
be justified in all the work that I have done. 

Edward Atkinson. 
Brookline, Mass., 

July 4, 1889. 



PREFACE TO SECOND EDITION. 



THE just criticism which has been made upon this book is that 
there is too much repetition in it and that there is too much 
of it. The fact that a second edition is called for proves, how- 
ever, that the book had a right to exist. 

The author may make no apology for its quality. No one can be 
more aware than himself of the disadvantage of the busy man of affairs, 
whose literary work must be wholly done by dictation in the odd inter- 
vals of business and in the few hours out of business limits which may 
be rightly taken from necessary recreation — from reading novels and 
other methods of diversion from the customary routine of hard work. 
Such are the conditions under which this work has been prepared, with 
little assistance even in making compilations of statistics and no aid 
from any one in deriving from them the lesson which they seem to teach. 

What is needed for the right treatment of such questions as have 
been dealt with in this volume is a copartnership like that which has 
been entered into by some of the novelists. If one whose function is 
to study the facts of commerce and industry in order to wrest from 
them their meaning and their influence on life, could only find a part- 
ner among the men of leisure with the capacity to work out these facts 
into good literary form, a series of treatises corresponding to those in 
this volume might be prepared which would fill the gap now so appar- 
ent in the work of the purely student class and also in the work of 
economists and authors who have not had the opportunity to take part 
in actual affairs. The writer deems his own function to be more that 
of the compiler of materials which may be suggestive to others than of 
the practised writer who might, if possessed of the information and 
having the leisure, convert these materials into far better form. 

Sufifice it that through the vast extension of the work of investigation 
now being conducted by national and state bureaus of statistics, by ex- 
perts in the census department, and by many volunteers in the study of 
facts, a foundation is being laid on which the economist of the future 
may develop a science of social relations which shall correspond in its 
breadth, scope, and conclusiveness to many of the treatises on the 
exact sciences which are now being rewritten and recast in the light of 
modern observations of the facts of physical science. 

Edward Atkinson. 

Brookline, Mass., 
October i, 1890. 

vii 



CONTENTS. 



Preface 

The Industrial Progress of the Nation ; Consumption Limited, Pro- 
duction Unlimited — Commencement Address Delivered before the 
Graduating Class of the University of South Carolina, June 26, 1889 
The Food Question in America and Europe ; or, The Public Victualing 
Department ............ 

The Relative Strength and Weakness of Nations — Two Studies in the 
Application of Statistics to Social Science : 
I. — .Strength ......... 

II. — Weakness ........ 

Low Prices, High Wages, Small Profits : What makes them 
The Distribution of Products : 

I. — How can Wages be Increased ? 
II. — Must Humanity Starve at Last? 
III. — Progress from Poverty 
IV. — The Progress of the Nation 
V. — The Struggle for Subsistence 
VI.— The Price of Life 
VII. — An Ea.sy Lesson in Statistics 
VIII.— Reforms That do Not Reform 
IX. — How Society Reforms Itself 
X. — Remedies for Social Ills 

Theory and Practice (Supplement to No. X.) 
What shall be Taxed ? — What shall be Exempt ? 
Production, Distribution, Consumption 
Slow-Burning Construction 
The Missing Science 
A Single Tax on Land , 
Religion and Life .... 

Index 



PAGE 

iii 



33 



53 
80 

lOI 

137 
155 
163 
176 
192 
200 
209 
219 
229 

239 
247 

253 
2gi 

309 
339 
351 
377 

389 



THE INDUSTRIAL PROGRESS OF THE 

NATION 

CONSUMPTION LIMITED, PRODUCTION UNLIMITED 



THE INDUSTRIAL PROGRESS OF 
THE NATION; 

CONSUMPTION LIMITED, PRODUCTION UNLIMITED.' 



GENTLEMEN : I imagine that it very seldom happens that one 
who has missed the training of the College or of the Univer- 
sity is called upon to make the Commencement Address to a 
graduating class, as I have been invited at this time by your Faculty. 
Such, however, having been my loss in the process of education, you 
may not expect from me either a literary treatise or a philosophical 
essay ; I can give you only a few observations which I have drawn 
from the experience of practical life. 

I have been for nearly fifty years engaged in the actual work of life in 
dealing with the material processes which are necessary to the support 
of mankind in comfort and welfare. I have had but little time for 
reading books, and I am not learned in economic science as it is laid 
down in the almost innumerable treatises which have been written under 
the title of Political Economy. I can only deal with the aspect of life 
from the standpoint of a workman, but I use the word " workman " in 
its broadest and not its narrow sense. The mind of man is the prime 
factor in the work of life. In the material work of production and 
distribution, without the work of the mind the hand would never have 
gained its power, or it would lose its cunning. The material processes 
which are necessary to existence, and which are conducted under the 
name of farming, manufacturing, trade and commerce, are sometimes 
looked down upon as being relatively inferior occupations — mere work 
for bread and butter ; or they are looked upon at least as not being 
entitled to the same place of dignity or estimation as the so-called 
" learned professions " ; but I claim for what may be called the 
unlearned professions a place upon the same plane and of equal stand- 
ing with all others, yielding precedence to only one, the highest of all 

' Commencement address given to the graduating class of the University of South 
Carolina, June 26, 1889. 

I 



2 The Industrial Progress of the Nation. 

professions, that of the jurist. I render the highest honor to him, the 
law-giver, the true jurist, the man who of right provides against wrong, 
under whose impartial supervision laws are made and enforced, and 
by whom the rigid provisions of statute law, imperfect as it must 
always be, may be alleviated in the Court of Equity. 

Had I anticipated the honor which you have conferred upon me in 
granting me the Degree of Doctor of Laws, I should hardly have ven- 
tured to incorporate in my address this estimate of the jurist. You 
may well conceive that my satisfaction is the greater because the. pass- 
port which you have given me to enter my name among the learned in 
the higher law, carries with it a recognition of service measured more 
highly than I could have ventured to hope for. I most profoundly 
thank you for this recognition, and I shall value a Degree from the 
University of South Carolina more than any that could have been 
conferred upon me by any other institution of learning. 

So long as man dwells in this body upon the earth, the development 
both of the mental and the spiritual elements in human life must 
depend in great measure upon the manner in which the human body 
itself is sustained ; that is what bread and butter stand for, or as I 
believe Carlyle himself once named it, the " Potato Gospel." 

I might not again venture to quote to you the old and trite aphorism 
" Mens Sana in corpore sano," had I not asked my friend Dr. William 
Everett to give me a similar aphorism which should indicate that even 
the spirit could not be rightly developed except in a well-nourished 
body ; to which demand he at once replied, " Non est animus cui non 
est corpus." Can there be a soul unless the body eats ? 

On the other hand, the very necessity which is imposed upon us to 
sustain the human body by manual and mechanical work re-acts upon 
the mind, and this tends to build up the character of the man himself 
in just and even proportion to his own conception of the true purpose 
of his own life. To him who has faith in a higher power which is both 
supreme and wholly beneficent, no matter from what source he may 
have derived his idea of the Eternal, there can be but one conception 
of life itself. The premises on which that conception may be based 
must be, that this world is the best world that could have been made ; 
that the conditions of this life are the best conditions that could have 
been established for the development of mankind ; and that the strug- 
gle for existence, hard and severe as it seems to us, must be the 
necessary school by which man could have been elevated above the 
beasts of the field. If there could have been a better world or a better 
method for the development of mankind, man would have the right to 
ask his Creator why it had not been established. 

In other words, to me the alternative of Atheism is my own concep- 
tion that the whole purpose of life is beneficent and not maleficent, and 



Consumption Limited, Production Unlimited. 3 

that all shall share in the wise purpose of the Almighty to bring all to 
that conception of life which shall give rest and re-creation to the soul. 

In the material world, all we can do is to move something ; but if 
there were no obstruction to movement, if there Avere no friction, there 
could be no movement of any kind. So in the moral world, if there 
were no possibility of wrong- doing, there could be no right-doing. 

In the material world again, if there were no law of gravitation 
exerting its centripetal force, there could be no lifting of the clouds, no 
falling of the rain, no development of the plant, no life of the animal ; 
then no man could exist upon the earth to be elevated by the necessity 
of labor to the perception of his manhood, and by the development of 
his own personal character and intelligence to the domination of the 
forces of nature. 

If there were no material wrong to be overcome in the physical 
world, there could be no virtue in overcoming wrong ; and without the 
struggle in and with the physical world in order to attain true character, 
there could be no mental conception of the spiritual world which is 
around us and beyond us. 

It follows then that the three phases of our life upon the earth, the 
material, the mental, and the spiritual, cannot be separated ; they are 
complements of each other, each necessary to the other ; therefore 
each phase of life must be developed in harmonious relation to the 
others. May we not then assume that the beneficent purpose of that 
part of our lives which is passed upon the earth in which we are 
forced to keep up the struggle and to labor for existence, is the 
building up of each individual character by way of that very struggle ? 
Would not the work of life otherwise be wholly without meaning? 
This is the true " potato gospel." It is not a dismal science. The ex- 
perience of men and of nations may sustain this principle. 

We can seldom help those who cannot help themselves, and the 
sentiment of philanthropy often leads to mistaken efforts to remove 
the necessity for labor. We may alleviate want, and our humane sym- 
pathies compel us to do so when called upon ; but we cannot remove 
the causes of poverty by giving relief, only by showing how relief may 
be earned. We can maintain great bodies of men if we have the 
capacity to dominate over them, by directing their mere physical force 
to the supply of their material wants, without mental effort on their own 
part ; but such conditions are dangerous to him who assumes the con- 
trol, and are also degrading to those who subject themselves to such 
domination and control. 

There can be no great progress in a community where a privileged 
class assumes a superior position, and, holding it by force or cunning, 
undertakes to protect an inferior class from the consequences of their 
own ignorance. In any well-organized society, equality of rights and 



4 The Indttstrial Progress of the Nation. 

the recognition of the law of mutual service are the necessary con- 
ditions on which only must rest any true and permanent progress even 
in material welfare. Every one knows how easy it is to render those 
who are willing to be helped without rendering corresponding work or 
service ever more and more incapable of helping themselves. What 
we can do is to remove obstructions from their way, to provide for 
their education, and then to give all an equal opportunity with our- 
selves to work for their own living under just laws assuring equal 
rights. 

Let us then analyze this work of life. One half the work of life in 
this most prosperous country is even to-day of necessity devoted to the 
mere purpose of obtaining food. Why should this struggle for food 
have been permitted ? What does it mean ? The greater part of the 
surrounding atmosphere consists of nitrogen ; yet the most important 
and costly element of our food is nitrogen in such a form that it may 
be capable of being absorbed by plants and thereby converted to the 
subsistence of men. There are great tropical sections of the world in 
which the conversion of the nitrogen into plant life through the rapid 
decay of all organic forms yields most abundant subsistence. But we 
do not look to the tropics for the development of the highest type of 
manhood. If what are called favorable conditions for the most 
abundant product did in fact develop the highest type of man, we who 
dwell far away amid the granite and ice of New England might in 
truth have some cause to fear for our future. Midway between the 
tropics and our zone, which is sometimes called Temperate — perhaps 
because it is subject alike to tropical heat and to polar cold, and can 
only be called Temperate on the average, — comes in your Sunny South. 
Dividing the Sufiny South midway is the ter7'a, no longer almost 
incognita, as it was when I first ventured to picture it, the Land of 
the Sky. 

How many of you, I wonder, yet know what opportunities you have 
at your disposal, waiting no longer for Northern capital but now being 
developed by Southern enterprise ? Was I wrong when, but a few 
years since, I ventured to describe this land, in which, until a very 
recent day, two or three million homespun people still using archaic 
forms of English speech, were almost the only dwellers ? Was I wrong 
when I said that if a line were drawn southerly from the Potomac 
along the easterly margin of the Piedmont plateau, westerly on the 
southern edge of the uplands of Alabama, northerly to the Ohio along 
the margin of the Cumberland plateau, taking in that most fertile and 
beautiful country that eye hath ever seen, the blue-grass region of 
Kentucky, and back again to the point of beginning, — that boundary 
would enclose an area more than three fourths as large as France and 
twice as large as Great Britain, containing potential in agriculture 



Cons2i7nption Limited, Production Untimited. 5 

equal to either, with minerals and timber equal to both combined ? 
That land was waiting only for the mind of man to become the prime 
factor in production. That I was not wrong, let the great enterprises 
of the New South bear witness. I need not name them. 

Over this great stretch of country the glacial drift never passed ; 
the soil consisting of the disintegrated rock of the old Laurentian 
Chain is rich in all the elements of fertility that give the strength to 
your timber and the beauty to your mountains ; on which, within two 
hundred miles of distance east and west from the border of the Piedmont 
plateau to the top of Roan Mountain you may find the \i\io\& flora and 
faima which extend from the St. Lawrence to the Gulf of Mexico, on a 
line of two thousand miles north and south. When the shrinking of the 
crust of the earth occurred, by which these convolutions were made, of 
which the Laurentian Chain with its lateral ridges and plateaus forms 
a part, the one hundred miles more or less of sandstone which separate 
iron from coal in the northern section (or which overlies them render- 
ing the mines deep), forming sharp ridges and making difficult grades 
to be surmounted, were not thrown up. In the southern section of the 
chain down there in Alabama, the iron, the coal, and the limestone lie 
close together in adjacent hills, and almost dump themselves by their 
own gravity into the furnace in which they are to be converted to use, 
when they are but once loosened from their beds. 

Endowed with all these elements of wealth and welfare, you young 
men of the Sunny South and of the Land of the Sky are now entering 
into vigorous and urgent competition with us of the cold and sterile 
North. Behind us both stand the unnumbered millions who occupy 
the fat and fertile prairies of the far West, waiting for the service which 
each of us may render them in exchange for the huge abundance of 
their fields. W^e welcome the contest, because it is in the busy contest 
of industry that the highest qualities of manhood have been developed 
and may yet be established. But we may sound the note of warning — 

" We tell each land ; while every toil they share, 
Firm to sustain and resolute to dare, 
Man is the nobler growth our realms supply, 
And souls are ripened in our northern sky." 

It is the function of the economist to deal with these elements of 
wealth and welfare and to evolve the laws of social science to which all 
human statutes must be made subordinate, so that the gratuitous gifts 
of nature with which you are so abundantly endowed, and in which we 
may share by the exchange of services, may be converted equitably to 
the use of man. 

I might have given you the title of this Address — Individual Liberty 
the only condition on which Material Welfare can be assured. 



6 The Industrial Progress of the Nation. 

Given just laws and local self-government established under the 
central sustaining power of a great nation ; given equal opportunity and 
free commerce between the States, under which each man may provide 
for his own wants by rendering service to his neighbor ; and we may 
then discover that while our consumption is limited the power of produc- 
tion is practically unlimited. 

In the treatment of this subject, in which I shall endeavor to 
demonstrate the principle that individual liberty is the only condition 
on which material welfare can be predicated, you will bear in mind 
that liberty is not license ; that it does not of necessity stand for the 
concept of the economists of France, who, at the end of the last century 
became famous by adopting the motto, " laissez /aire, laissez passer.'' 
Individual liberty implies full liberty for men to combine for mutual 
benefit ; it does not of necessity imply the separation of individuals any 
more than their combination. There are many processes of productive 
and distributive industry which may be accomplished more effectually 
by combination under laws and rules, as in the ordinary railway cor- 
poration, than through isolated individual action. There are also some 
necessary processes of a productive or constructive order which are 
intimately connected and bound up with the industry of every country, 
but which may be accomplished by the State acting as a corporation, 
better than they can be done by the individual or the private cor- 
poration. 

At what point the function of the State or of the corporation rightly 
ends, and exactly at what point the separate function of the individual 
should begin, is a matter to be determined by experience and not to be 
laid down a priori with the assurance of a dogmatic principle. Given, 
as I have said, just laws and local self-government well established 
under the central sustaining power of a great nation ; given equal 
opportunity within the domain of a nation, with free commerce or the 
exchange of services established under organic laws, under which 
each man may provide for his own wants either by his own work, 
by combination with others, or by rendering service to his neighbor ; 
and then only may we expect to derive from experience a true con- 
ception of the fundamental rules by which human society should be 
governed so that the general welfare may be assured. 

Social science is therefore in great measure an experimental science. 
I have faith to believe that on the basis of the progress which we have 
already attained in this country, the conception which I present as an 
hypothesis may prove to be a principle, and may be acted upon with 
absolute assurance of its truth, to this effect : that while the consump- 
tion of man in respect to the means of subsistence is limited, — the 
power of material production, /. ^., the power of mankind to direct the 
forces of nature to the purpose of sustaining human life in comfort and 



Coiistimption Limited, Prodtictio7t Unlimited. 7 

welfare, is practically unlimited. The very suggestion that there may 
be such a principle calls attention to the profound importance of the 
study of economic science. 

It will doubtless be generally admitted that the three economic 
writers who have greatly affected the policy of Great Britain and who 
have therefore indirectly affected the condition of the whole English- 
speaking people more than any others, have been- Adam Smith, 
Malthus, and Ricardo. To these three names may perhaps be added in 
later years the names of Bentham and Mill. 

Each of the three writers first named submitted propositions or 
hypotheses which have greatly affected all subsequent legislation and 
which have, without question, given a direction to the social relations of 
the English-speaking people. 

Adam Smith, working on a true inductive method after as wide an 
investigation of the facts of life as the records of his time permitted, 
prepared the way for the development of modern industry and com- 
merce. Had he published the " Wealth of Nations " but a few years 
earlier than 1776, the futile attempt of the ten million people who then 
inhabited the island of Great Britain, might never have been under- 
taken, to control by force the commerce and industry of the three 
millions who then occupied the colonies of America for the ■ sole 
purpose of benefiting or adding to the gains of those who assumed to 
govern them. But there was not time for the new conception of 
commerce and of what made the Wealth of Nations, which Adam 
Smith presented, to pervade the minds of the people of England before 
the War of the E.evolution occurred. This war was distinctly the result 
of the economic error which was the basis of the so-called mercan- 
tile theory of trade, to wit, that in all international commerce what 
one nation gained another must lose ; from which false premise came 
the conception of the English and of all other European nations, that 
the object in establishing and holding colonies in other parts of the 
world was to secure the sole control of their traffic. 

It followed of necessity from this misconception of the nature 
of commerce, that the attempt was made to control the industries of the 
colonies by force, this attempt long preceding the further effort to 
impose taxation without representation. Force was met by force, and 
the necessary separation of the great colonies of America from the 
mother-country, which might have taken place at a later period by 
peaceful methods, was brought about by war, engendering an animosity 
which has hardly ceased to affect the public mind even down to the 
present day. 

A little later Malthus attempted to formulate a law of population 
upon the basis of utterly insufficient data compiled in a crude way. 
There were then no complete national statistics upon which reliance 



8 The Industrial Progress of the Nation. 

could be placed or which could be safely cited in support of his views. 
He attempted to prove that the tendency of population is to increase 
faster than the means of subsistence, and he even adopted the mathe- 
matical formula which is now very often cited as if it were an absolute 
truth, that " population tends to increase in a geometrical ratio while 
the means of subsistence increase only in an arithmetical ratio." This 
hypothesis is utterly without warrant either in fact or in experience 
Malthus appears to have had no imaginative faculty, a very essential 
quality in dealing with economic questions. He therefore could not 
forecast the future nor foretell the wonderful results that would be at- 
tained through the new scientific discoveries and the better understand- 
ing of the art of production and of distribution which had begun even 
in his own day to work a profound change in the relations of men to 
each other. 

Ricardo, a banker, chiefly engaged in affairs, was governed by the 
limitations of a rigid accountant and an observer of what is called the 
money market. His treatment of the whole question relating to bank- 
ing and currency is of the most valuable kind. His theory of rent, 
however, was wholly based upon the misconception that the material 
products of the earth depend upon certain inherent qualities of the 
soil; varying in different places and subject to exhaustion. He did not 
conceive of any method by which the soil might be used as an instru- 
ment of material production, subject to an increase of production 
in proportion to the measure of intelligence as well as of the labor and 
capital expended upon it. Hence the fallacy of his alleged law of 
diminishing returns from land in proportion to the labor and capital 
put upon it. He omitted the mind of man in his treatment of the land 
question, and thereby omitted the prime factor in all material produc- 
tion, even from the soil. 

The hypotheses that population tends to increase faster than the 
means of subsistence, and that land tends to yield diminishing returns, 
to some extent obscured the broader view of Adam Smith, and gave a 
very narrow conception to the teachings of the school of English 
economists until a very recent period. It may now be affirmed that a 
true philosophy of Social Science which must now almost of necessity 
be developed upon the inductive method and on the basis of experience,, 
may not have been capable of treatment by any European writers until 
very recently, on account of the necessary limitations due to their 
environment. The experience of nations which have been subject in 
the past to methods of government based upoii privilege assumed to 
have been derived from Divine right, cannot be taken as the basis for 
rules which should be applied to free nations. On the one hand the 
conceptions of the English school of economists could not be applied 
to the conditions of India ; and on the other hand they may not be ap- 



Conszwtption Limited, Production Unlimited. 9 

plicable to the very different conditions of this country ; yet the very 
existence and general application of these views of the English writers 
have profoundly affected the conditions of all the English-speaking 
people, including ourselves ; and one or the other of the concepts of 
Malthus or Ricardo modified in some degree by Mill have governed or 
influenced nearly every writer on economic science in this country. 
They have imparted to the minds of those who have adopted them, 
either consciously or otherwise, the hopeless conception that in the end 
the distribution of the necessaries of life must be compassed by force, 
and that the possession of land and of all other instruments of produc- 
tion and of distribution must ultimately rest upon force. Such must be 
the necessary conclusion from these conceptions, it being very evident 
that whenever the time shall arrive when the means of subsistence are 
not sufficient for the support of an increasing population of which the 
surplus can no longer migrate, the rule of survival must of necessity 
become the rule of the survival of the strongest, the most cunnii^g, the 
most subtile. From these premises follows also the necessary conception 
of a government by privilege sustained by force, rather than of a 
government established by the consent of the governed. 

In an indirect and perhaps somewhat obscure way these false con- 
ceptions, especially Ricardo's theory of rent, have had a very great 
influence upon the English customs of land tenure and upon the 
conduct of the internal affairs of Great Britain and Ireland, although 
the views of Adam Smith have for about one generation only, con- 
trolled her foreign commerce. The present difficulties in Ireland may 
be attributed to the false concepts of English rulers for the last two 
hundred and fifty years, and to the efforts, which only ceased with the 
present century, to destroy great branches of industry in Ireland lest 
great branches of industry in England should suffer from their 
competition. 

Among our own students of economic science the hypotheses of 
Malthus and Ricardo, coupled with the false theory of wages sustained 
by Mill until a very late period in his own life, have also held a con-, 
trolling influence. 

Great progress has, however, been made within the last few years in 
defining the true source of wages and in proving that wages constitute 
a share of the product for the time being, in which production capital 
aids but is not the source, since even the annual sum of wages could 
nowhere be paid out of pre-existing capital. 

On this line of investigation, perhaps, Professor J. E. Cairnes 
opened the way more than any other writer. 

The influence of the German School of State Socialists, coupled 
with the so-called Collective theory of production, has pervaded and 
perhaps perverted the minds of a great many of our younger men ; but 



T o The Industrial Progress of the Natio7z. 

no very substantial addition to economic science has been made by 
theoretic writers or by students of social science in this country, except 
in the compilation and application of the most adequate statistics 
which are rapidly becoming available for use. The best economic 
work yet done in this country has been the study of the facts and con- 
ditions of life in a country substantially free from the inherited privi- 
leges of the past, on which the basis of a true science may be laid. 

It would perhaps be invidious to mention names, but those of Wells, 
Walker, Wright, White, Hadley, Fink, Smith of Columbia, Taussig, 
Laughlin, Seligman, and many others are presented to the mind almost 
instinctively, whose work in the compilation of social data or in their 
application is rapidly bearing fruit. There are many others whose 
names are not yet much known beyond the limits of their own States, 
who are compiling the data upon which a true economic science may 
hereafter be established. There is not, of course, an American science 
of Political Economy any more than there can be a French, German, 
or English science ; but a true inductive science may only be evolved 
in a country in which production and distribution are no longer gov- 
erned by status or by force, but are almost wholly conducted under 
free contracts entered into for mutual service. 

If the hypothesis of Ricardo were entitled to be considered as a 
principle of universal application, then the necessary conclusion would 
be that poverty would of necessity accompany progress ; and you will 
observe that the fallacies of Henry George in relation to the possession 
of land are based upon the Ricardian theory of rent. If mankind may 
not hold such control over the production of the means of subsistence 
as may ultimately assure the welfare of each and all, then the restora- 
tion of slavery might be justified or the restriction of the ballot would 
alike be called for. Government by privilege might then become a 
wiser method than government by the consent of all the governed. 

It may be somewhat presumptuous for one who has but little time 
for the study of economic literature to presume to put forward an 
hypothesis which is counter to the theories of most of the well-read 
men. As I have already said, I do not pretend to be a very well-read 
economist ; but I am inclined to think that it may be an advantage for 
any one who has a reasonably good faculty for observation, coupled 
with a power of reasoning from the facts which are now easily brought 
within the observation of any student, that he should be free from the 
bias which comes to the special student who crams himself with book 
knowledge. 

Social science is not like the physical sciences or the mathematics, 
one in which certain fundamental propositions may be laid down a 
priori, which are to be taken as proved and must therefore be accepted 
as the basis of all subsequent reasoning. There is no Euclid to be con- 



Consumption Li7nited, Prodtcction Unlimited. 1 1 

suited in this social work ; economic science is yet vague in its con- 
cepts seeking for a solid foundation, inductive and not deductive, — 
rather than yet finding one. It is therefore, perhaps, more expedient 
that one should have mastered the principal theories of a few of the 
great masters, and should then refrain from giving more time and 
attention to the variation in the application of these theories by the 
less important writers. He may, perhaps, be more capable than they 
have been of testing these theories from his own observation. 

The late President Garfield had very clear convictions upon all 
these questions, and had he lived he might perhaps have become a 
leader of thought had his political courage been equal to his con- 
victions. He told me that he dated his intellectual life from listening 
to a lecture by Ralph Waldo Emerson, given in the old parish church 
in Williamstown, in the only year which he had been able to spare from 
work to be devoted to college training, — of which lecture all that he 
could remember was that Emerson said : " Mankind is as lazy as it 
dares to be." 

One may venture in such an address as this to be a little egotistical, 
since there is more teaching by example than by precept. I date my 
own intellectual life from the reading of " Sartor Resartus " ; after that, 
Carlyle's " French Revolution " ; then from listening to, and personal 
acquaintance with Theodore Parker ; but my interest in Political 
Economy, which Carlyle denounced as the " dismal science," was only 
fully aroused when the incomplete but most suggestive treatises of 
Frederic Bastiat first fell into my hands ; I commend them to you. 

Many of you may hereafter have as little time as I have had to 
continue the study of books. Must you then accept the dogmatic 
teaching of others ? By no means. Work out your own mental as 
well as your own material salvation ; and if you do it with a right 
purpose you may even add a little to the common stock of ideas as 
well as things — perhaps adding more than you take away. That is the 
way the world gets on. 

In my own way I have reached a certain general conclusion, perhaps 
itself a priori ; it is this : There must be a scientific basis by which the 
relations of men are governed, and on which the material products of 
the earth must ultimately be distributed so as to conduce to the com- 
mon welfare, else the power which controls all does not rule all things 
well. 

I observe that in dealing with all other material processes of nature 
it has become apparent that there is a tendency to equilibrium or har- 
mony in all the forces by which the universe is governed ; and I look 
for the same harmony in the social relations of men. How shall this 
harmony be attained ? It has pleased God to make that problem the 
true work of our lives. 



1 2 The Industrial Progress of the Natio7t. 

This faith in the Divine purpose of every life and in the final attain- 
ment of welfare here or hereafter, it matters not which, is, for myself,, 
the only nexus between religion and life. It is the creed by which I 
test all dogmas and theories — theological, political, or economical, — it 
is the little star to which I have hitched my wagon, and which will 
guide me on my way even if no one else can see it. I advise you all, 
whatever your vocation may be, to establish a creed in your own minds 
which shall be your own, and also to take up a hobby wholly aside 
from your necessary work in getting a living. 

In attempting to evolve the laws of social science or the relations of 
men to each other in the material world, may we not conclude by 
analogies drawn from the physical world that in the correlation, 
of forces there must be an equilibrium in which harmony will be- 
attained ? Read Bastiat's " Harmonies of Political Economy," incom- 
plete and imperfect as it is. 

Consider, for instance, heat and cold ; we know that there is a. 
margin of many thousand degrees between extreme heat and extreme 
cold ; we also know that if for a single moment the thin shell of atmos- 
phere or vapor which protects the earth from the sun's rays were swept 
aside, the earth itself might become a cinder. We also know that the 
continued existence of vegetable and animal life upon the earth rests 
substantially within the limit of one hundred degrees Fahrenheit ; yet 
that equilibrium within that range has been established for unknown 
generations. 

We also know that if from any cause the internal heat of the earth 
were to be lowered a little below the present plane which is very near 
the surface, water would disappear ; then our earth would be desic- 
cated ; yet the equilibrium of these forces has been maintained for an 
unmeasured period under conditions which are consistent with the ex- 
istence of life ; and life, so far as^ we may reason about it, may yet 
continue for unnumbered generations. Who can measure the eternal ? 

" High over space and time it rides, 
The high thought that can never alter." 

If then there is an equilibrium in the forces of nature which makes 
life possible, may we not predicate upon that fact the existence of a law^ 
although we cannot yet formulate it, on which we may assume that 
there must be an ultimate equilibrium between material life and the 
means of living ? 

Our statistics of population do not yet cover a single century with 
any approach to accuracy, yet a law of diminishing population begins 
to be perceived even in prosperous and peaceful countries, in spite of 
the huge abundance in the means of living and the improvements in 
distribution, and notwithstanding that the average duration of human 



Consumption Limited, Production Unlimited. 13 

life is prolonged in each century beyond that of the previous one. 
Statistics begin to prove that there is a law governing the growth of 
population which is not enforced by any artificial method of limiting 
the existing population to the present means of subsistence. On the 
basis of this creed, as I have called it, I have ventured to seek for some 
broad generalization, which may not yet be capable of proof, and which 
may be still only an hypothesis, but which shall be wholly consistent 
with the conception of a beneficent power creating and governing the 
world and ruling all things well. I have ventured, therefore, to say that 
on the basis of the statistics compiled in recent years, it may soon be 
proved to be a rule or law of life that the power of mankind to con- 
sume the means of subsistence is limited, while on the other hand, the 
power of mankind to produce and distribute the means of subsistence 
is practically unlimited. 

I have frequently ventured in conversation to try this hypothesis 
upon different people, and the very surprise with which it has been 
received goes to prove that the counter-proposition has unconsciously 
governed the thought of a very large proportion of the thinking people 
even of this country. 

In sup])ort of this rather startling proposition it may be suitable to 
point out again that material life is itself only a conversion of material 
forces into a new form ; but man is the only animal that accumulates 
experience and thereby attains the power to give a new direction of a 
permanent kind to these forces of nature ; he therefore frees himself 
from subjection to the law of the survival either of the strongest, the 
most subtile, or the most cunning ; he attains the power to exist and 
multiply by dominating the forces of nature, thereby increasing pro- 
duction, and makes progress by exchanging services with his kindred. 
Under these conditions, the survival of the intelligent and the capable 
tecomes assured because they are the fittest to survive. 

We derive the greater part of the means of subsistence from the 
soil, a little from the sea ; now if we regard the soil as a laboratory in 
which the forces of nature may be converted into food in just propor- 
tion not only to the labor and capital, but to the mental capacity of him 
who makes use of the soil as an instrument of production, in place of 
working land merely as a mine that may be exhausted, we find that 
there is as yet no limit that can be put upon the production of the 
land ; no man can say that any single acre of land anywhere has been 
exhausted ; and no man can prove that any single acre anywhere has 
ever yet produced the maximum of food which could be produced from 
it in proportion to the work done. In California an inventor who is 
also a farmer has lately applied machinery of his own construction to a 
little bit of the soil of a single county, a farm of three thousand acres 
in Tulare County, with such effect that the product of wheat of three 



14 The Industrial Progress of the Nation. 

hundred days' work of one man, which is equal to one year's steady 
occupation, may in a fair season come to nine thousand bushels ;. 
deducting enough for seed, this product would yield an average of a 
barrel of flour each to about eighteen hundred people ; if we charge 
this wheat with the cost of dist^bution from California to Great 
Britain, this one man can supply one thousand of the inhabitants of 
Great Britain with bread. This is the modern miracle of the loaf. 

Down in Florida a little while ago I came across an old New Eng- 
land sea-captain who had become familiar with the value of the cassava 
root, when trading in South America. One of his neighbors, a colored 
man, had complained to him that a bit of land he was trying to culti- 
vate was chuck full of roots ; "he could n't get 'dem roots out"; the 
Yankee on looking at the roots found them to be the cassava from 
which tapioca is made ; he planted an acre and a half the season before 
I visited him ; and on the product of that little patch he had fed seven 
cows, two horses, three calves, and several hogs for seven months, and 
he still had a considerable part of his roots to draw upon. The butter 
which his wife had just churned was good, wholesome, yellow butter, 
such as I am familiar with on my own place ; not white, waxy and 
tasteless. 

What else is there in the way of roots that we yet know but little 
about ? Nitrogen is the most expensive element in fertilizing the soil 
or in feeding man and beast ; yet the larger part of our atmosphere 
consists of nitrogen. Who can tell how soon the chemist may find out 
a quicker way of converting the nitrogen of the atmosphere into a form 
in which it may become food for plants ? There are plants which in 
some way or somehow appear to derive their nitrogen directly from the 
atmosphere ; these are the renovating plants Avhich are turned under, 
clover, buckwheat, etc. ; the cow-pea vine is one of them, familiar to 
you all (and if I am rightly informed, the common expression for poor 
land is, " That 'ere land aint even fit to grow pea-vines on "). The 
mushroom is full of nitrogen ; who knows how soon the botanist may 
enable the growers of mushrooms to produce tons to the acre in place 
of the little basketful which we seek to gather from our own private 
preserves that we never tell any one else where to find ? The deserted 
tunnels in the California gold and silver mines are now being made use 
of to grow mushrooms for the market, perhaps yielding a product 
which will be more useful and profitable than either the gold or silver 
that would be taken from them. 

Suffice it that throughout this century, a century in which science 
has been more fully applied to production and distribution than ever 
before, the means of subsistence have been gaining rapidly upon the 
population of the globe ; and from the very time when Ricardo pro- 
pounded his hypothetical theory of rent, and laid down the supposed 



Consumption Limited, Production Unlimited. 15 

law of diminishing returns from land, the man who has farmed with 
brains rather than with hands has been able to obtain a steadily increas- 
ing product with a diminishing quantity of labor. 

So far as there are any statistics which can be relied upon for proof, 
the proposition or hypothesis which I have just substituted for consider- 
ation is more fully sustained than any other economic proposition 
upon this branch of social science. 

If, then, there may be such a law governing and steadily increasing 
production in ratio to the labor devoted to the work, in what way shall 
the benefit of this law be distributed .'' and how shall the increased 
production tend to the common enjoyment and common wealth of rich 
and poor alike ? That is now the burning question. 

I feel fully justified in bringing these rather prosy facts even into a 
Commencement Address, because your President who invited me was 
formerly a Professor of Agriculture in Tennessee, and it was through 
that that I made his acquaintance. I was engaged in the investigation 
of the system of saving green crops, named ensilage ; I had ventured 
to make a statement in an address given at the opening of the 
Mechanics Institute in Boston, the next exhibition immediately follow- 
ing the exhibition at Atlanta, in which the minerals, the timber, and 
the examples of then almost unknown resources of your Southern land 
were first brought to the attention of South and North alike, in Sep- 
tember, 18S2, to this effect : " If I were to say to you that next to the 
abolition of slavery and the use of the railway and the steamship, the 
re-discovery of the method of saving green crops called ensilage 
would prove to be the most important event in its effect on the 
material welfare of the present century, you might suggest that a 
Commission de lunatico iiiquirendo, should be appointed to examine the 
condition of my brain ; yet I venture to make that statement." From 
President McBryde I received the best evidence then existing sustain- 
ing this view. He had traced the silo back two thousand years, finding 
it described almost according to modern methods in the Germanica of 
Tacitus. Thus it is that in one case, at least, the classics and the 
economics came together ; and I am justified even in this old and 
classical University in talking plain prose about production. 

It is also alleged that just before the first shot was fired at Fort 
Sumter one of your South Carolina chemists was analyzing the mineral 
phosphates of your coast ; some one brought him the Ordinance of 
Secession, and asked him what he thought of it. He somewhat im- 
patiently replied, " That 's not what South Carolina needs ; she needs 
manure." I leave it to you whether the chemist was justified or not. 

I have said that the main question now at issue is not one of pro- 
duction, but of distribution. What have you young men to do in this 
matter ? You have learned only in recent years that in personal liberty 



1 6 The Industrial Progress of the Nation. 

there is opportunity. Until freedom has been established throughout 
this broad land there could have been no equal competition. We are 
approaching the end of the century of the greatest wars recorded in 
history ; we are hearing the end of g, century in which national debts 
incurred almost wholly for war purposes will either have been paid, or 
else ih part or wholly repudiated because they cannot be paid. Even 
at this time when the preparation for possible war, which is even more 
burdensome than active war itself, is eating out the very heart of Eu- 
rope, may we not venture to predict that war itself will soon become 
an anachronism ? Let me call upon you to join with me in thanking 
God that the Potomac had not become the Rhine, separating two rival 
and hostile nations, each maintaining different institutions, which would 
have led to antagonism and would have rendered the waste of standing 
armies and the maintenance of heavy taxes of the most destructive 
kind, as necessary on this continent as they are thought to be necessary 
to the existence of nations in Europe. 

May we not take courage from a backward glance ? It is but a few 
centuries since even a private war gave a title to honor. It is only a 
few years since the private duel became a crime and a dishonor even 
in this country. It will be but a few years before the captains of in- 
dustry will take precedence, while the captains of the army may become 
but the officers of a police force organized chiefly for the maintenance 
of civil order ; to which position we have already substantially rele- 
gated our little army in this country, in which the final establishment 
of the principle of liberty has almost done away with the necessity for 
any force in the conduct of our affairs. 

Again : 1 may now venture even here to recall the fact that while 
the great Civil War devastated our own country, yet for many years 
the treaty of reciprocity in trade with Canada had so united the people 
even of that foreign Dominion with ourselves, that not one single sol- 
dier was sent to guard that long northern flank, and not one ship of 
war was required to defend our ports against our neighbor. Mark the 
contrast ; and also mark the influence for wrong which may come from 
restrictions which one nation may place in the way of the mutual ser- 
vice of its people and those of another country. The petty tax which 
we have so unwisely maintained on the salt fish and smoked herring of 
■Canada has brought us to the very verge of a quarrel, of such a nature 
that a single unwise word or act might have precipitated us into a 
wicked war. 

Whether we will or not, the welfare of mankind depends upon the 
true comprehension of the nature of commerce. To the friendly con- 
test in the pursuit of industry we of the North welcome you of the 
South. You have most diiificult problems to be solved ; you have ob- 
structions to progress to be overcome, and so have we of the North. 



Consinnption Limited, Production Unlimited, 17 

We may well remind ourselves alike that the highest type of manhood 
has been developed under the most adverse conditions and in places 
where the struggle for material life has been the most rather than the 
least severe. The dangers and difficulties which we have yet to sur- 
mount in our respective sections differ in kind but not much in degree. 
Ignorance and incapacity are with us all. Twenty-eight per cent, of 
the present population of Massachusetts are foreign-born ; more than 
fifty per cent, of foreign birth or parentage. Can we bring all into 
subjection to law through intelligence rather than by force 1 

I think the most prosperous country that I ever visited is the little 
kingdom of Holland, where the men who made the state made the very 
land itself on which the state is founded, over which they laid their 
smooth brick roads for the conduct of their trade, and built their great 
water-ways to the sea for the conduct of their commerce, a hundred 
years or more before a single good modern highway existed in England 
although the Romans had left the vestiges of their great Roman roads 
built by them nearly two thousand years before as an example of what 
might be done. Witness the long struggle of the Dutch to maintain 
their liberty, of which it is written by their great historian that although 
not producing a single grain of wheat they ate the whitest bread in Eu- 
rope ; and although they were subjected during their long struggle with 
Spain to taxes which before the end took up one half the product of 
the whole people, yet they came out of that struggle for liberty rich 
and strong, and more powerful than they had ever been before. How 
did they accomplish this ? Was it not in the pursuit of trade, com- 
merce, and industry 1 While the Spaniard sent his armed ships to con- 
quer foreign lands, reducing the inhabitants to slavery and bringing 
back treasures of gold and silver, which rendered the nation poor be- 
cause they were secured by rapine, — the Dutch sent out their fishing 
fleet and supplied the Spaniards at home with food at the cost of a 
large share of this very treasure, gaining wealth by the fruits of their 
commerce, while the Spaniards grew poor even on their ill-gotten gain ; 
and when the Spaniards again craved the wealth, seeking to recover it 
by conquest of the Dutch and to plunder them as they had plundered 
their own colonies, the very seamen who had been trained in the Dutch 
fishing fleet manned their navy and beat off their would-be oppressors. 

It begins to appear from the true history of the last two or three 
centuries that the most potent cause of war among men in modern 
times has been the false conception of the functions of commerce. 

It may be held that the material well-being of this country has been 

secured more fully by that clause in our Constitution which forbids 

State interference with commerce between the States, than by any 

other of the provisions of our organic law. Under these conditions 

each section is free to develop its resources in its own way. I am also 
2 



1 8 The Indtistrial Progress of the Nation. 

profoundly convinced that the true education consists in home educa- 
tion ; in the development of the schools, the colleges, and even the 
universities in which the foundation is laid just where the best work of 
the future is to be done. The post-graduate courses in special lines 
may be concentrated elsewhere, as they are in the Johns Hopkins 
University in Baltimore, and as they are to some extent at Harvard. 
You will bear in mind that I speak to you as a man of affairs addressing 
those on whom the conduct of affairs in your own State and in your 
own vicinity will mainly rest, and who will develop the productive in- 
dustry of your own section in just the measure that you learn that the 
mind of man is the prime factor in all arts. 

I have said that the main question now pending is not one of pro- 
duction J an abundance is already assured in this land for this and for 
many generations yet to come. The main question now at issue is that 
of distribution. How shall the several sections of this country share not 
only in providing the abundance but in securing an equitable distribu- 
tion of their respective products, receiving in return that part of their 
subsistence which they obtain by exchange ? 

Let me now call your attention to what I think is the most wonder- 
ful chapter in economic history, the true bearing of which neither you 
nor I can yet measure nor estimate — to wit, the industrial progress of 
the South since the way to material progress and prosperity was first 
opened by the establishment of personal liberty throughout this whole 
broad land. 

I may venture perhaps to treat this subject in a very concise way at 
this time, because it will fall to you, the graduates of this and of other 
Southern Universities, to supply the mental factor which, as I have 
already said to you is the prime factor in material production and 
in material welfare. With respect to certain products you hold almost 
a monopoly, and monopolies are perhaps more dangerous to those who 
purport to enjoy them than they are to those who are subject to pay for 
them. It is fortunate for you that you have not the absolute control of 
the cotton trade. There is just enough possibility of competition else- 
where to compel you to apply science, skill, and economy to the growth 
and preparation of this great necessary staple ; and you have a great 
margin for improvement to work upon. Your supremacy in the produc- 
tion of the cotton fibre is due to the gift of God and not to the skill of 
man ; you have the temperate climate, cold enough in winter to prevent 
the cotton plant becoming a perennial ; you have the great central 
range of mountains gathering the moisture from the winds that blow in 
over the Gulf Stream, precipitating them in showers, seldom in destruc- 
tive floods ; you have the strong soil of the upper country over which 
the glacial drift never passed and from which the phosphates so neces- 
sary to the production of cotton have not yet been washed out ; you 



Consumption Limited, Production Unlimited. 19 

have the lowland soil redeemed from the shallow sea, full of minute 
shell and other elements of fertility yielding the phosphates so neces- 
saryi to the production of the seed of cotton which is the true function 
of the cotton plant, the fibre being only the wing of the seed. The seed 
takes fifty pounds of phosphate from the soil to each bale of cotton, 
while the fibre takes but four. In these natural conditions you excel 
all other areas of the world in which cotton grows except Egypt and the 
region on the Paraguay and the Parana rivers now being so rapidly set- 
tled by the Italians. So long as the Egyptians are despoiled and de- 
prived of personal liberty as they are now and always have been by the 
oppression of debt and taxes to which the people never gave their con- 
sent, and of which it is the disgrace of civilization to enforce the pay- 
ment since that payment almost reduces the population to starvation — 
you have not much to fear from them, although the staple of their 
cotton is better than yours and although, as a rule, it is better prepared 
for market. Of course in making this comparison I take no cognizance 
of the little crop of Sea Island cotton which does not belong to the use- 
ful class and only serves for purposes of luxury. You may be subject 
to competition in the somewhat distant future when the region on 
the Paraguay and the Parana rivers is fully settled, and the atten- 
tion of the Italians, who have been bred in habits of the closet economy 
and thrift, is given to the production of the cotton fibre. You may 
then, if not sooner, be forced to change your methods of treating your 
cotton in the preparation of the bale and on its way to market. There 
is no great commercial staple so barbarously treated as the cotton bale 
of the South even at this time, except the crude products of the most 
barbarous races of Asia and Africa. This is not a pleasant thing to 
say ; but observe that in saving waste there is a great margin of profit 
which the intelligence of the South may reap even from this improve- 
ment, when the present bad method is acknowledged. Yet in spite of 
what has still to be done, witness the vast progress that has been made 
even on this very line. 

The first pamphlet that I ever published was printed in the year 
1861, entitled " Cheap Cotton by Free Labor" ; and in that pamphlet 
I had brought together all the evidence which even then existed, pre- 
cisely as it does now, of the value of the seed of the cotton ; I made 
the record either in that pamphlet or in a subsequent magazine article 
I forget which, that if there were a variety of the cotton plant which 
would grow in the Northern States, producing no staple and only seed, 
it would become" one of our most valuable products. You have now 
but just discovered this new source of wealth which had been known in 
China for five hundred years or more. While the cotton seed rotted to 
waste in the olden time, your sugar cane craved the phosphates which 
cotton-seed meal now supplies after the oil has been expressed. That 



20 The Industrial Progress of the Nation. 

is now known, and the sugar cane is fertilized as it had been in 
Formosa for five hundred years. I see that some one has just dis- 
covered that the ground hulls mixed with the meal make a better food 
for stock than the over-rich meal fed by itself. In that again there is 
nothing new ; I called attention to it long ago. 

Again you may have such an advantage in the production of iron 
as may enable you to draw a large part of that branch of industry away 
from some of the places where it is now conducted, as that work was 
taken away from New England and from other points, when anthracite 
coal was substituted for charcoal in dealing with the ore. But it will 
not be by the direct establishment of tht production of pig-iron or crude 
steel that the general welfare of the South will be assured, whatever 
maybe the gain in personal wealth. It is the consumption of iron which 
marks the progress of a state, not its production. 

In 1880 the State of Pennsylvania yielded about one half the pig-iron 
produced in the whole United States ; and if we should take the esti- 
mate of the representatives of that State in respect to the importance of 
this branch of industry, we might almost fear that the State of Penn- 
sylvania would suffer from the competition of Alabama ; but such will 
be very far from being the fact. If Alabama can send up to Pennsyl- 
vania a larger supply of pig-iron and crude steel at less cost than it can 
be produced within her own limits, Pennsylvania will make the greater 
gain. In 1880 the population of Pennsylvania was nearly four and one 
half millions, of whom nearly one and one half millions were occupied 
in gainful work in the conduct of all the arts of life. How many do 
you think it required of all this great army of industry to work the iron 
mines, the coal mines which supplied the blast furnaces, and the blast 
furnaces themselves, from which nearl)^, or quite one half, the pig-iron 
of the country was sent out to be put to use ? Only about thirty-five 
thousand men and boys out of nearly a million and a half did this 
work. If the South should take this art away from eastern Pennsyl- 
vania, a few great chimney-stacks may remain as reminders of by-gone 
work ; but when you send to her mechanics, to her artisans, to her 
machinists, to her engine-builders, to her tool-makers, to her black- 
smiths, to the hundreds, or even thousands, by whom iron is consumed 
where there are ten engaged in its production, even in that State, then 
the little force of men discharged from beneath the ground or from the 
mouth of the fiery furnace may find higher occupation and better pay 
. in the consumption of iron and steel in Pennsylvania than they ever 
found in making iron there. 

These examples bring me to the point to which I urgently call your 
attention. The secret of prosperity and of widely diffused welfare does 
not lie within the walls of the great factory ; it is not to be viewed by 
the light of the blast furnace ; it is not hidden in the dark interior of 



Consumption Limited, Production Unlimited. 2 1 

the bowels of the earth ; these are but the crude factors ; it does con- 
sist in the thousand little arts which spring up in the sunshine of per- 
sonal liberty which make the village, pervade the farm, and bring men 
and women into closer and better human relations than those either of 
the factory, the furnace, or the mine. 

It has been a favorite idea of my own for many years, long before 
we heard so much of manual training and of the laboratory method of 
teaching the mechanic arts, that in every University a Chair should be 
established to be occupied by the Professor of Gumption. You smile, 
and maybe ask what I mean. I mean a kind of instruction which shall 
educe faculty, versatility, observation, readiness, aptitude, and dexterity. 
I could not myself lay down the course of study or name the text-books, 
though perhaps I might teach the art myself. 

I have referred to the bad treatment of the cotton bale. To the 
young man who possesses gumption there is the way to fortune in saving 
a part of that waste. In the department of the University devoted to 
the Art of Gumption, one of my rules would be that in each year two 
or three months should be devoted to journeying on foot through the 
land, as the German Burschen used to and perhaps do now, in order 
that each young man might find out how little people know, and also 
how much less he knew himself than almost any one else. In this way 
he might find out that the true object of the University is to learn how 
to begin an education, and to know where to go and what authorities 
to consult in its future conduct. 

If the student were to start with only enough money to bread him- 
self for a week, and were obliged to pay his way on the rest of his jour- 
ney, the more lessons he would learn in gumption and the more 
opportunity for applying it. There is hardly a machine or a process of 
industry now in use or practice that will not be out of date in twenty 
years, and the great fortunes of that day will be in possession of those 
who save the force that is now wasted. That State will be ahead which 
buys the most rags and sells the most paper. But we need not wait 
twenty years to learn this fact. The young man endowed with gump- 
tion may begin to observe the pre-historic methods of spinning and 
weaving in the heart of the Land of the Sky. He may find the wayside 
furnace and the old Catalan forge for making iron, in southwestern 
Virginia, and as he passes on his way he may even observe some traces 
of older methods of chemistry applied to moonshine distillation. 

Emerging from these primitive places in which time has worked so 
little change in two centuries, we may find every type of progress, from 
the small factory or forge-working for the neighborhood up to the great 
factory in which a margin of profit of a quarter of a cent a yard suffices, 
and where the highest wages are earned in making a product at the 
lowest cost. The whole history of many arts that have required centuries 



2 2 The Industrial Progress of the Nation. 

for their evolution may be studied in its progress in the course of 
a thirty day's vacation. 

Not many months ago two of my Southern friends, Mr. Breckinridge 
of Kentucky, and Mr. Wilson of West Virginia, visited Boston. They 
were on the Committee of Ways and Means, and they desired to look 
over some of the branches of industry in Massachusetts, on whose 
materials or products they might be called to legislate. They were put 
in the way of visiting the great factories ; I went with them to one 
large city where I had arranged that after they had been through the 
factory they should go to one of the factory boarding-houses and par- 
take of the customary meal which is furnished to the factory operatives, 
the best breakfast, dinner, and supper that could be had for the price 
anywhere within my knowledge, and I have made a special study of the 
distribution and the use of food. They returned to the city much im- 
pressed with what they had seen. In the evening, when dining with me 
and with some other friends, I said to them : '' I wish you would come 
to my office to-morrow morning, and I will take you to the points where 
you will find reason to change your conclusions if you think you have 
touched the secret of New England. You think you have touched that 
secret, do you not ? " " Why, yes," they said ; "we might think so " ; 
to which I replied : " You have not ; all that you have seen is common- 
place ; where I shall take you to-morrow I do not know, but in an hour 
I will disclose the secret which is open to all who possess gumption." 
They came, and we went up a narrow court opposite the Old South 
Church, into a nest of buildings plastered all over with little signs, a 
busy hive of industry covering arts almost without number. In the 
first room we entered we found two men beating out gold-leaf for the 
dentist ; in the next we found a man and a boy seated by a little fur- 
nace and a little forge, shaping steel knife-blades, too busy to stop the 
little trip-hammer, or even to speak to us ; in the next, half a dozen 
men working in wood, turning out athletic implements of various kinds ; 
and so on ; and when the hour was over I said to my friends : " Come 
back here and stay a week, and in every fifteen minutes of ten hours 
of each day I will take you to the places where in the making of the 
goods and wares there is the making of the man as well, and even then 
I shall not have begun to exhaust the tale of the lesser arts for which 
gumption is required." 

I have been rejoiced in my more recent visits to your Southern land 
to see how this secret is being disclosed to you. Don't think that you 
are to succeed in competition with the North by way of long hours of 
work and low wages in the factory or in the mine. You will not subject 
us to any serious danger in the control of the -thousand industries 
until you have learned the whole secret, that shorter hours and higher 
wages bring low cost of production where gumption has been taught, 



Consumption Lmiited, Production Unlimited. 23 

and where the leisure earned by him who does the work in the best 
way becomes the opportunity for the diligent and intelligent use of his 
spare time. It is on these lines that you should devote that mental 
factor which is the prime factor in material progress in every single art 
on which true prosperity can be predicated. 

Your pig-iron, in which you may hold supremacy, may reach a 
huge proportion in the eyes of those who cannot see through a plate of 
iron ; but when I look through the plate of iron to something beyond, 
I find that the hens' eggs sent to market from the barnyards of the land 
to be consumed every year, are without question more than equal in 
value to the largest annual product of pig-iron ever made in this country. 

It is somewhat embarrassing to repeat myself, but as I am a special 
student of the art of nutrition I will again venture to touch upon a 
somewhat scientific demonstration of the great progress of your 
Southern people during the present generation, and I will repeat a 
little story that I once told at Atlanta. Lord Truro, the head of a 
commission of inquiry of some sort in Great Britain, wrote to me two 
or three years since to ask if I could give any explanation of the 
" deterioration of the American man " ; he appeared to take it for 
granted that such a deterioration had occurred, and that I should give 
him the reason for it. Well, I used to think myself only an average 
man in size, height, and weight at home, but when I made my first visit 
to England I was rather surprised to find myself a tall and large man 
by comparison with those whom I passed in the streets. A little later 
I learned of the comparisons which had been made by Dr. Henry 
Bowditch in respect to the size, height, weight, and physical develop- 
ment of the class of young men who go to the universities and higher 
institutions of learning in England and in this country. He had proved 
conclusively that the boys in our higher schools and the young men in 
our universities were taller, heavier, stronger, and better developed than 
the average English boys at Eton and Harrow, or of the young men 
of the same age at Oxford and Cambridge. But I was a little puzzled 
how to prove a general rule to the satisfaction of my economic friend. 
It then occurred to me that for a long term of years, sufficient to prove 
a rule, the people of this country had been clad in ready-made clothing. 
I had learned, when studying that branch of industry on its economic 
side, that in every thousand garments there were certain proportions of 
given sizes around the chest, the waist, and of given length of leg. I 
sent a circular of inquiry to a large number of clothing manufacturers, 
from which I received returns which probably covered their experience 
in making betweeen one hundred million and two hundred million suits 
of clothing during the last thirty years. Of these replies, among others 
three were from firms, one in St. Louis, one in Baltimore, and one, I 
think, in Cincinnati, whose trade had been mainly with the South. 



24 The Industrial Progress of the Nation. 

These replies attracted my attention. Each stated that in former days 
your Southern men were longer in the leg than they were big around 
the waist, but within the last few years the waist has grown an inch to 
an inch and a half on the average, and now measures more than the 
length of leg. To the head of each of these establishments, which had 
given their opinion independently of the others, I put the question : 
" What is the cause of this change ? " And each one answered, in his 
own way : " The better conditions of life, and the better nutrition due to 
the progress of industry in the Southern States account for this change." 

Am I wrong in bringing all these commonplace ideas into a Com- 
mencement Address ? What else can you expect from one who missed 
the training of the college ? 

You young men are about entering upon the work of life, and I 
have about done with it. The poet says to you : 

" Life is before ye, and as now ye stand 
Eager to spring upon the promised land, 
Fair smiles the way where yet your feet have trod 
A few light steps upon a flowery sod." 

You have passed four years in your undergraduate course ; you are 
about to take up your professional studies or to enter directly into the 
struggle for life. To many, perhaps to all, the urgent question now is : 
What shall be the measure of your compensation ? In common 
speech : What will be the rate of your wages ? We all work for wages,, 
material or immaterial ; we stake or wager our time, our intelligence, 
our physical afforts against the return which those whom we attempt to 
serve will render to us as the price of our effort. When we begin the 
true work of adult life few of us have ever yet rendered any service ;. 
we have cost the community all that we have consumed ; but we have 
not produced, or added to the production of any thing ; how shall we 
become entitled to either a small or a great prize, material or immate- 
rial, out of the future product ? The question which every man may 
rightly put to himself when choosing his function, is this : What is the 
service that I can render by which I may become entitled to my own 
gains, whatever they may be ? 

The measure of your compensation will not be your own estimate 
of what you can do, nor may it be in any measure corresponding to the 
cost of putting you where you are. It may not even be the measure of 
what you produce if you take part in material production. For want 
of gumption you may work hard and yet produce little or nothing of 
what people want, because they already have a plenty, as of cotton, for 
instance. 

The true measure of the dollars of your gain will be what you save 
other people from doing. If you are versatile, capable, if you have 



Consumption Limited, Production Unlimited. 25 

gumption, you can do what they think it is necessary that some one 
should do for them better than they can do for themselves ; they pay 
you well for the time and labor which you save them. At this standard 
if you engage in reputable and useful occupation, the very dollars of 
your gain, no matter how numerous they may become, will be the tokens 
and the measure of the services which you have rendered to your fellow- 
men. It is in this way that personal wealth and common welfare are 
or may be reconciled. 

The law of life is the law of service. We are members one of 
another, and the very existence of society rests upon the interdepen- 
dence of its members. The only factors which are or can be placed at 
the disposal of each and all alike without distinction of race, color, or 
condition, are time and opportunity. These being given and equal 
rights being secured under just laws, the measure of your own success 
will be the measure of the services which you are capable of rendering 
to your fellow-men. 

What, then, is the measure of our opportunity ? It may be rightly 
considered that only a very small part of the population of the globe 
computed now at about fourteen hundred millions, belong to what may 
be called the machine-using nations. The arts to which modern labor- 
saving inventions have been applied are to be found in greatest measure 
in Great Britain and the United States ; next in the Netherlands and 
in France ; and last in Germany ; but these states comprise in all 
only about two hundred million people. Very limited progress has 
been made in the application of modern methods of industry toward 
increasing the abundance of home production in Italy, Austria, or 
eastern Europe ; almost none in the great continents of Asia, South 
America, Australia, and Africa, except in the extension of the railway 
systems. If then it follows that by way of the application of science 
and invention to all the arts of life an abundant product can be attained 
at low cost, then that nation may attain the greatest benefit from the 
progress of science in which this abundant product is free from the 
blood tax of the standing armies and the money tax of great national 
debts, and in which all the forces in action tend to remove the preju- 
dices engendered by distinctions of race, privilege, creed, or condi- 
tions, and to make the whole body corporate one people. Among that 
small number of nations and states in the civilized world which I have 
named, the United States, England, the Netherlands, France, and 
Germany, in which modern inventions and modern machinery have 
been most fully put to productive use, who will hold the advantage of 
position ? Will it be the English-speaking people of the United States 
including Canada, as the time is rapidly approaching when the people 
of Canada will no longer be prevented from exchanging their services 
or products with us by an arbitrary border-line ? 



2 6 The Industrial Progress of the Nation. 

Will it be the English-speaking people on their little island where 
the finer ores of iron are now wanting, and where even the coal may 
soon be costly ? 

Will it be the polyglot races who dwell apart from each other on 
the continent of Europe, still separated by all the malignant forces 
born of war which tend to maintain the distinctions of race, privilege, 
caste, creed, and condition ? 

If the interdependence of men and of nations be admitted, it fol- 
lows of necessity that the exchange of products or services among them 
benefits both parties in every exchange. It does not follow, however, 
that the measure of the benefit in terms either of time, of money, or of 
product must be equal ; although the exchange is that of equivalents in 
money value. For instance, the vast population of China, now believed 
to be nearly or quite four hundred million people, are clad almost 
wholly in cotton and silk, the cotton ginned and the silk reeled, and 
both fibres spun and woven wholly by hand. Their textile fabrics are 
therefore produced by the application of the maximum of time and 
labor with a minimum of product. The machine-made fabrics exported 
from Europe and from this country would not suffice to supply ten per 
cent, of the population with their average need. China can export raw 
silk as well as tea to the advantage of consumers because no successful 
method has yet been invented for reeling silk from the cocoon except 
by hand. It follows that silk as well as tea is the^ product of handi- 
work of a kind which calls for the utmost dexterity and skill. There 
is, as all know, an excess of population in China capable of performing 
these handicrafts ; and although the Chinese and the Japanese are in 
some respects the best educated people in the world, technically speak- 
ing, yet being limited to hand work, wages are very low, lower than 
anywhere except in India. 

To the extent, therefore, to which other nations will buy tea and 
silk, the Chinaman will take in exchange cotton fabrics and other prod- 
ucts made by machinery. In this way her people secure materials 
for clothing at less cost than when they produce them for themselves. 

The capacity of a spinner or a weaver in any of your Southern fac- 
tories in which you are now making coarse drillings and sheetings re- 
quired in China, is fifty- to one hundred-fold that of the hand spinner 
or weaver in China. If you buy twenty dollars' worth of tea it costs 
perhaps two hundred days of Chinese labor ; when you sell twenty 
dollars' worth of drills or sheetings they may represent less than twenty 
days of American labor in the field and in the factory. But when the 
Chinaman cannot sell the tea which cost two hundred days of labor, 
and is forced to make the cotton fabric, that fabric may cost him five 
times as much work as it does to make the tea, or five hundred days' 
work. In this example you will find an instance of the rule which is 



Consumption Limited, Production Unlimited. 2 7 

fundamental, to wit : that the rate of wages constitutes no standard of 
the cost of production. The compensation of the workman depends 
upon two factors, his own skill and the effectiveness of the capital or 
machinery which shall be placed at his disposal ; under these con- 
ditions it follows of necessity that in proportion to the effectiveness of 
the capital, that is to say, in proportion to the application of science 
and invention to the resources of a given country — or to the resources 
of a given section of any country, the wages or compensation of the 
workman will rise as the cost of production will be reduced ; it follows 
■of necessity that the rule of progress in a given community is this : 
High wages or earnings either in money or in what money will buy are 
the necessary result or consequence of a low cost of production in all 
the arts to which science and invention in the concrete form of modern 
machinery and tools can be applied. This is but another way of saying 
what I stated at the beginning of this Address, — t/ie mind of man is the 
prime factor in mate7-ial production. It follows also that where com- 
merce is absolutely free as it is among the States of this Union, wher- 
ever the raw materials exist in greatest abundance under the most 
favorable conditions for working them, either in the mine, the field, or 
the forest, there the production of the crude or primary forms of 
manufacture will be conducted at the lowest cost, and at the same time 
under the highest wages that can be paid in such primary processes. 
But since time and space have been almost eliminated by the railway 
and the steamship, the cost of transferring many of these crude ma- 
terials is but a small element in the cost of the higher or complete 
forms of manufacture ; therefore the finer and higher branches of 
industry may be almost independent of distance, and may be quite re- 
mote from the place where the crude materials are provided ; such 
branches of industry will centre at the point where the conditions of 
society are the best ; where both public and private credit are the 
highest ; where the skilled mechanic can find the best common schools 
for his children in their earlier years, or the best technical schools for 
them as they grow up ; where the parents who can afford it can find 
the best universities in which to make the most profitable investment 
for the benefit of his children in giving them a complete university 
preparation for the higher duties of life ; where the savings-bank, the 
building society, and the title insurance company make it very easy for 
any man of moderate aptitude or industry to become the owner of his 
own dwelling-place ; in other words, the higher forms and the best-paid 
branches of productive industry can be conducted under the best con- 
ditions where population is moderately dense ; this is the reason why 
towns and cities grow ; to such points food, fibres, and metals may be 
readily brought, and there all the minor services on which the inter- 
dependence of society rests may be rendered with the least obstruction. 



28 The Industrial Progress of the Nation. 

Under these conditions we of the cold and sterile North welcome 
so willingly the competition of the South and West ; you can provide 
the means for our welfare in far greater measure than you can ever take 
away from us any part of our industry ; and we may both gain by this 
exchange. We could not bread ourselves for a week ; our forests are 
depleted ; we have neither mines, forests, nor fields on which we can 
any longer rely for any full measure of subsistence ; we must draw all 
the materials on which we work, and nearly all the food that we eat,, 
from distant points ; but so long as we can lead you in the application 
of science and invention in the conversion of these crude products into 
the finer forms, we may exchange fabrics for fibres, wares for crude 
materials, shoes for leather, wagons for timber ; and on the saving of 
that which others waste, which is now the entire profit left in almost 
any branch of manufacture, we may still provide the capital by. which 
our labor will be well sustained. 

Thus it is that in the " vigorous prosecution of the pursuits of 
peace," so well advised by our Governor Andrew at the end of the 
Civil War, each section. State, town, and person may gain that position 
to which our commerce may entitle us, free from the obstruction of 
tariffs, and free from the burden of destructive taxation which now 
oppresses all other machine-using nations. 

We are approaching the end of the nineteenth century, the century 
in which the greatest progress due to the application of science and in- 
vention to the production of the means of subsistence has been made \ 
the century in which ores have been quickly turned into metal ; in 
which steam has been converted into power, although as yet by crude 
and wasteful methods of using fuel ; in which many of the most ex- 
hausting processes of labor have been relieved. 

We are also near the beginning of the twentieth century, a century in 
which the waste product even of the iron-stone left after the conversion 
of impure ores into pure iron and steel will be converted into food for 
man and fibre for clothing, by pulverizing the phosphatic slag and with 
it fertilizing the lands which have been wasted by ignorant labor ; the 
century in which heat may be converted directly into work, power, and 
light ; in which aluminum, the lightest and strongest metal which 
forms the base of clay, may even displace iron and steel in common 
use for many purposes ; in which nitrogen may become a low-priced pro- 
duct derived from the cheap conversion of the force of the atmosphere 
into the fertility of the soil, a process almost sure to come from the work 
of the French chemists and of our own chemists, notably Prof. Wm. O. 
Atwater, of Connecticut ; the century in which water will be burned 
for fuel, and in which power, light, and heat, under the impulse of that 
strange form of energy which we name electricity, may be applied in 
every household at the touch of a button in the wall ; and this will be 



Cons2imption Limited, Production Unlimited. 29 

the century in which all the methods of distribution may be as com- 
plete as the power of production shall have become adequate. 

When this new century begins one generation will have passed away 
since this country was devastated by our Civil War ; the fruits of the 
war will then be free for the enjoyment of those who are to come, and 
who will have been spared both the pains and the penalties due to 
their fathers' toleration of a wrong which was inconsistent with the 
principle of personal liberty — the principle on which this nation was 
founded by our common ancestors : by Washington and Franklin, by 
Jefferson and Adams, by Rutledge and Hancock, by Patrick Henry 
and Alexander Hamilton, by Lee and Greene alike. 

In the providence of God our single century of national life is but 
as a day that is past. We know that it has been the fate of many whose 
future welfare rests on you young men, that in the century that is past 
they were subjected to wrongs "darker than death or night." We 
know that to others it had been given as to you 

" To hope till hope creates 

From its own wreck the thing it contemplates." 

We know that the way to personal liberty has been at the cost of 
so much blood and treasure. To that principle of liberty we have all 
surrendered, and by its power both North and South have been subdued. 

In the new light which now shines o'er all the land, emulating each 
■other in the vigorous pursuit of peace, order, and industry, we may 
become like the Prometheus Unbound, the Titan among the Nations. 
Then you and your children and your childrens' children, secure in 
their personal liberty attained at so great a cost, may realize the very 
vision of the poet ; then may be established a nation which shall be 

" Good, great, and joyous, beautiful, and free. 
This is alone life, joy, empire, and victory." 

This is my second visit to these noble halls, so like the old colonial 
buildings of Harvard, and to your beautiful campus. When I first 
came here, down under the hill in a great school building, more than 
nine hundred enfranchised blacks were eagerly striving to attain the 
rudiments of an education ; but here upon the hill the voice of no 
student broke the silence. Robert Barnwell, ex-senator of the United 
States, and then one of the oldest living graduates of Harvard Uni- 
versity, acting as librarian, kept up the continuity of your history. I 
spoke hopeful words to him, and I trust that he lived to see the day 
when new life again surged through your halls. When I returned 
home I told my friends in Massachusetts that only when the univer- 
sity on the hill should be as crowded as the school-house by the side 
of it, would the true progress of the South begin. That time has come. 



30 The Industrial Progress of the Nation. 

I, myself, missed, as I have told you, the training of the college, 
but I am an honorary member of the Phi Beta Kappa of Harvard, 
and from 1877 to 1891 I shall have had representatives there, one of 
whom accompanies me in my present visit. As I left her Class-Day 
festival to start on my journey, I thought I might venture to bring to 
you the fraternal greeting of our ancient University, and to that 
President Eliot empowered me ; but when I took in the true signifi- 
cance of this greeting, and the meaning of the fact that one should 
be its messenger, for whom there could have been no welcome here at the 
time when he himself might have been a graduate, I felt that something 
more than my own feeble words were needed, and I sought for living 
words to fitly mark this day ; with them I will conclude an Address 
which has wound its devious way too long and perhaps too far afield : 

" Ring out the old, ring in the new. 

Ring, happy bells, across the snow, 
The year is going, let him go ; 
Ring out the false, ring in the true. 

'' Ring out the grief that saps the mind 

For those that here we see no more ; 
Ring out the feud of rich and poor. 
Ring in redress for all mankind. 

" Ring out the slowly dying cause 

And ancient forms of party strife ; 
Ring in the nobler modes of life, 
With sweeter manners, purer laws. 

" Ring out old shapes of foul disease ; 

Ring out the narrowing lust of gold : 
Ring out the thousand wars of old ; 
Ring in the thousand years of peace. 

" Ring in the valiant man and free. 

The larger heart, the kindlier hand ; 
Ring out the darkness of the land ; 
Ring in the Christ that is to be. " 



THE FOOD QUESTION IN AMERICA AND 

EUROPE 

OR, THE PUBLIC VICTUALING DEPARTMENT 



THE FOOD QUESTION IN AMERICA AND EUROPE; 

OR, THE PUBLIC VICTUALING DEPARTMENT.' 

IN the year 1865 the average production of grain to each inhabi- 
tant of the United States, man, woman, and child, was thirty-two 
and one half bushels, consisting of Indian corn, wheat, oats, 
barley, rye, and buckwheat. 

In the year 1885 the average product was fifty-two and one half 
bushels, an increase of more than sixty per cent. 

The gain in the production of hay, of meat, of dairy products, of 
fruit and other articles of food cannot be accurately measured, but 
has doubtless been equal to th.ej>er capita increase of grain. 

If objection be taken that the agricultural statistics of 1865 were 
incomplete, because taken so soon after the war, reference may be 
made to the average of the decade 1865 to 1874 inclusive, in which 
years the crop of grain averaged 37xxfir bushels per head, as against 
the average of 487V0 bushels per head in the years 1875 to 1885 — a 
gain of over twenty-seven per cent, per capita. The gain is really 
greater than is indicated by this percentage, because the proportion of 
our population which was engaged in agriculture was less in the sec- 
ond period than it was in the first. 

In 186 1 the railway service between the East and the West had 
for the first time become a unit, by the completion of various sections 
of railway connecting the whole system at many points. The impor- 
tance of this fact in its connection with the power of the North to 
concentrate its armed forces, and to supply them with food during the 
civil war, has yet to be treated. It was an important factor in the 
power of the North to maintain the integrity of the nation. 

It was not until 1869 that the first consolidation took place of a 
through line under one management, from Chicago to the seaboard. 
This was then accomplished by the late Cornelius Vanderbilt. 

In 1865 the average charge for moving a ton of produce from 
Chicago to the seaboard, and for moving general merchandise from 

' Reprinted from The Centitry Magazine for December, 1886. 
33 ■ 



34 The Industrial Progress of the Natioii. 

the East to the West, was at the rate of three cents and forty-five 
hundredths per ton per mile. In 1885 it was sixty-eight hundredths of 
a cent for the same service. 

If we take certain typical quantities of flour, beef, pork, corn,, 
dairy products, and of fleece wool, weighing thirteen tons, their value 
at the market prices for export in the city of New York in the year 
1865 was $1,124.33, either for export or for domestic consumption, 
and they remained substantially at this value during the years 1 866,, 
'67, and '68 — the period of paper inflation. The cost of moving thir- 
teen tons one thousand miles over the New York Central Railroad 
and its connections in 1865 was $448.63, leaving to the producer or 
his agent in Chicago the net sum of $675.70 in paper money, equal to 
$475.76 in gold. The same quantities of the same articles were worth 
in the city of New York in June, 1885, $575.98 in gold. The cost of 
moving them a thousand miles was $88.40, leaving to the producer or 
his agent $487.58 in gold. But in the interval the efficiency of the 
farmer, measured by the increase in the grain crop per capita, had in- 
creased by sixty per cent., so that he could have placed twenty tons in 
New York in 1885, as against thirteen tons in 1865, the value of which^ 
after deducting the freight, was $780.13. These figures may explg,in 
facts which are of common observation. The old mortgage debts 
have been paid, and the rate of interest on capital in the West now 
differs little from that in the East on the same security. 

Thus it appears that, notwithstanding a reduction of price by one 
half, the increased efficiency of the railway service and the restoration 
of the gold standard of value have enabled the farmer of the West to 
grow rich on the low price of produce, where he would have inevitably 
become poor under the former system of paper money, high prices,, 
and heavy railway charges. 

If we apply the rates at the two periods to flour, as an example 
of the average food of the people, at ten barrels per ton of 2,000 
pounds, — which is within a fraction of the true quantity, — the cost of 
moving a barrel of flour 1,000 miles in 1865 was $3.45. In 1885 it was; 
68 cents. The average ration of wheat-flour to each adult person in. 
the United States is well ascertained to be one barrel each year. 
Our population is now computed at somewhat over 58,000,000, or, 
if we rate two children of ten years old or under as one adult, we 
number in our consuming power 50,000,000 adults, each requiring 
one barrel of wheat-flour a year, all of which is moved on the aver- 
age at least 1,000 miles from the producer to the consumer. Before 
railways were constructed, grain which was 150 miles distant from 
a waterway could not be moved that distance without an expenditure 
about equal to its value. If wheat had been subject in 1885 to the 
charge of 1865, the cost of moving 50,000,000 barrels of flour 1,000 



The Food Question in America and Europe. 35 

miles would have been $172,500,000. At the actual charge of 1885 
over the New York Central line, at the average traffic charge of the 
year on all merchandise, of 68 cents, the cost was $34,000,000, a dif- 
ference of $138,000,000 on the flour only. 

Bread, however, is a less important factor in the subsistence of the 
people of this meat-consuming country than it is in other countries. 
In the Eastern and Middle States recent investigations of the Bureaus 
of Statistics of Labor — especially in Massachusetts — sustain the sub- 
stantial accuracy of previous computations made by the writer from 
the accounts of factory boarding-houses as to the average standard 
daily ration, or cost and quantity of the daily supply of food materials 
of adults who are occupied in the work of every-day life as artisans, 
mechanics, factory operatives, or laborers. The average in the fac- 
tory boarding-houses — the occupants being mostly adult women — 
comes to 24 cents a day. A fair average cost of food for men and 
women engaged in manufacturing and mechanical arts appears to be 
25 cents a day, varying in some measure in respect to the proportions, 
as the dietary of men varies somewhat from that of women, working- 
men consuming more animal food than the average of factory opera- 
tives, who are mostly women. 

This daily ration consists of the following elements : 

Meat (including poultry and fish, a half to one pound, according to kind 

and quantity) at an average cost of . . lo cents 

Milk (half pint to one pint), butter (i to l|^ ounces), and a scrap of 

ch eese 5 ' " 

Eggs (one every other day) at 12 cents a dozen ]A " 

Total cost of animal food I5j^ cents 

Bread (about ^ of a pound) 2 J^ " 

Vegetables (green and dry) 2-2)4 " 

Sugar and syrup 2 

Tea and coffee i 

Fruit (green and dry) ' ^ " 

Salt, spices, ice, and sundries i^-i 

Average cost of daily ration 25 cents 

The proportions vary somewhat under different conditions, but 
they may be taken as a fair average standard ration for adult workmen 
and women. 

In the West the prices of meat and grain are less ; the prices of 
groceries somewhat higher ; but, on the whole, the same quantity of 
food can be purchased at somewhat less cost. In the South the habits 
of the people — especially of the colored race — are very different. 
Dairy products are much less used, and with the negro corn-bread 



36 The Industrial Progress of the Nation. 

and bacon (hog and hominy) take the place of most other varieties 
of food. On the whole, however, the proportion of wheat-bread to 
the other elements of the daily ration may probably be established 
at the proportion of one tenth of the whole ration. If we, then, 
save $138,500,000 per year in the cost of transportation on our bread 
bill only, do we save tenfold on our whole food supply ? Is our 
food, on the average, moved a thousand miles, either by railway or by 
waterway ? No exact reply can be given to this question. We find, 
however, that the tonnage which was moved over all the railways 
of the United States in the year 1883 represented, on the average, 
a fraction over seven tons to each inhabitant, man, woman, or child, 
moved an average distance of no miles. In 1884 this quantity was 
slightly reduced per capita, but the distance was a little greater. 
The charge for this service in 1884 was $8.75 per head of the whole 
population. In 1885 the quantity was a little more, the average per ton 
a little less, and the gross charge per person was $8.88. The largest 
single item of this traffic — probably one half — consisted of food for 
man or beast. When to this is added merchandise moved by water- 
ways and by wagon, and when consideration is given to the fact that 
all these materials must be sorted, converted, reconverted, and finally 
distributed in small parcels by wagon or by hand, so that every adult 
person may be sure to have from three to five pounds of solid food 
and one to two pounds of liquids, together with the necessary modi- 
cum of fuel, clothing, and shelter, the mere mechanism of subsistence 
can be comprehended, and the relative importance of the victualing 
department may .be fully realized. 

The average cost of the food materials in the Eastern and Middle 
States has been given. The people of these sections are even more 
dependent on the mechanism of distribution than any others. Their 
proportion of the railway tonnage must be double, in respect to dis- 
tance, that of the inhabitants of other sections ; and yet such is the 
perfection of the railway service at the present day that one day's 
wages of a common mechanic — or one holiday in a year devoted to 
work in Massachusetts, will pay the cost of moving a year's sup- 
ply of bread and meat from the prairies of the West to the centre 
of Eastern manufactures. This fact cannot be too often repeated. 

In view of these data, if the gain compassed in twenty years in 
the cost of moving bread alone has been $138,500,000 for one year, 
how much do we now save on all the necessaries of life ? No abso- 
lute reply will be attempted ; but it may be remembered that by way 
of the railway, waterway, and steamship the whole world has been 
converted into a neighborhood. Within the lives of very many men 
now living, each little area of this country practically depended upon 
its own labor for its own food. To-day the wheat of Oregon and of 



The Food Question in America and Etirope. 2>7 

California is carried around Cape Horn to England at a fraction of its 
value, while half the people of Great Britain derive their food from 
India, Australia, and America, or from fields which are from six to 
thirteen thousand miles away. A cube of coal which would pass 
through the rim of a quarter of a dollar will drive a ton of food and 
its proportion of the steamship two miles upon its way from the pro- 
ducer to the consumer. The great hotels of New York run special 
railway cars for carrying eggs from Michigan to New York, and yet we 
import hens' eggs in considerable quantity from Denmark and from 
Holland. If each adult in the United States consumes one egg every 
other day, at only twelve cents a dozen, which is the proportion of 
the factory operatives of New England, the value of our hens' eggs is 
$91,250,000 per year, or twice the value of the product of silver bul- 
lion, 25 per cent, more than the value of our wool-clip, and greater 
than the value of the entire product of our iron furnaces, even if we 
increase the product of pig-iron this year to 5,000,000 tons at $17 a 
ton, at the furnace, or $85,000,000 in the aggregate ; at which figures 
our iron industry would greatly prosper. 

I may venture to give once more a table which shows statistically the 
food bill of the people of this country, upon the assumption that each 
average adult ought to enjoy as good a supply of food as the adult 
factory operatives, mechanics, and artisans of New England and the 
Middle States : 

Per day. Aggregate per year. 

Meat, fish, and poultry 10 cts .' $1,825,000,000 

Milk, butter, and cheese 5 " 912,500,000 

Eggs (one every other day) 4 " 91,250,000 



Animal food I5-| cts $2,828,750,000 

Bread (f lb. per day) 2^ " 456,250,000 

Vegetables 2^ " 456,250,000 

Sugar and syrup 2 " 365,000,000 

Tea and coffee i " 182,500,000 

Fruit (green and dry) i " 91,250,000 

Salt, spices, ice, and sundries i " 182,500,000 



25 cts $4,562,500,000 

Deduct probable excess on sugar, tea, coffee, and dairy products 262,500,000 



$4,300,000,000 
Add spirits and fermented liquors at the average between the estimates 

of Mr. D. A. Wells and the advocates of prohibition about 700.000.000 



Probable price of food and drink constituting the victualing department 

for one year at the present time $5,000,000,000 

These figures are, as to each separate item, greatly in excess of 
ordinary computations, very few persons ever daring to estimate the 



38 The Ltdustrial Progress of the Nation. 

entire dairy product of the country at over two thirds the sum which 
is given in this table. In explanation of this discrepancy, I may state 
that few persons comprehend the great cost of distributing food in 
small parcels at retail. Perhaps the most difficult problem in the 
victualing department is to reduce this element of the cost of food. 
For instance, in the foregoing dietary the estimate for bread is three 
quarters of a pound per day, at a cost of two and a half cents, which 
would be at the rate of three and one third cents per pound of bread, a 
quantity corresponding to the ration of one barrel of flour per year to 
each adult, each barrel yielding two hundred and eighty pounds of 
bread. Now,' there is only one place within my knowledge where good 
bread can be purchased at so low a price as three and one third cents 
per pound ; that is in the shops of the Howe National Bakery in New 
York. In Boston I find the average price of bread which is sold in the 
bakers' and grocers' shops to be more than five cents per pound, at 
which price the larger population of this city is served. At five cents 
per pound the bread of the people of the United States would come 
to $700,000,000, in place of $456,250,000. It therefore follows that if 
the food bill 'of the people is not in quantity what this standard calls 
for, the reason is that the average dietary is not up to this standard, 
even after making the admitted deduction for the excess of tea, coffee, 
sugar, and dairy products which is consumed in the East, as compared 
to other parts of the country. 

In order that some idea may be gained as to the accuracy of the 
proportions which are given in this dietary, I have been enabled, by 
the courtesy of Mr. McHugh, Chief of the Bureau of Labor Statistics 
in Ohio, to give the average cost of the daily rations of the inmates of 
the insane asylums and of the reformatory institutions of Ohio. It is as 
follows : 

Meat (including fish and poultry) cents 6 j\ 

Milk, butter and cheese " j,-^^ 

Eggs " f^ 

Animal food " 10 

Sugar, syrup, salt, spices, and other groceries (including beans and lard). . . " 2^ 

Bread " 2^ 

Vegetables and fruit (green and dry) " 2 

Tea and coffee " -^-^ 

Total per day " 17^ 

Number of persons subsisted for one year 6256 

Many other comparisons might be made from the excellent reports 
of other Bureaus ; but this will suffice to establish the proportions of 
the victualing department. 



The Food Question in America and Europe. 39 

It is admitted that the ration of sugar, tea, coffee, and dairy prod- 
ucts in the previous table is too high ; but if, after making deductions 
for these elements of subsistence, the price of whiskey and beer be 
added at the average between the lowest computation of the skilled 
economist, Mr. David A. Wells, say about $500,000,000, and the esti- 
mate of prohibition advocates, $900,000,000, there can be no question 
that the total cost of food of the people of the United States is $5,000,- 
000,000 ; and at this estimate it doubtless represents one half the price 
of life measured in money to at least ninety per cent, of the population 
who do the actual physical work of the whole community. 

It is a well-established fact that, with respect to the more thrifty 
and prosperous classes of mechanics, artisans, and other so-called 
working-classes, as well as in regard to the larger proportion of salaried 
classes, one half the cost of living is the price of materials for food. 
As we go down in the grade of work to the level of the common 
laborer who can earn but from 80 cents to $1.25 per day, the propor- 
tionate cost of food materials rises to 60 and even 70 per cent, of the 
income of the family. 

Thus it appears that, notwithstanding the improvement in the 
mechanism of distribution, and in spite of the enormous increase in 
the per capita product of grain and other food, great numbers of per- 
sons, even in this country, can barely obtain their daily bread, while 
want exists in the midst of plenty. Why is this ? Is it not because 
we waste enough in ignorant buying and in bad cooking to sustain 
another nation as numerous, and because no common attention has yet 
been given to what may be called the Art of Nutrition ? The writer 
only ventures to refer to this art in anticipation of a series of articles 
upon the Science of Food, which are to be given in future numbers of 
The Century by Professor W. O. Atwater, to which this article may 
serve as an introduction. 

It is important to determine the causes of these false conditions in 
the United States. More difficult yet are the problems in such coun- 
tries as Ireland and Egypt, each name representing one of the m.ost 
productive areas of the earth's surface, capable of sustaining a greater 
population than exists in almost any other country in proportion to 
area, and yet both stricken with poverty, almost with famine. Why are 
fertile districts of northern Italy devastated by the pellagra^ a loath- 
some disease which is induced by insufficient nutrition ? Why has the 
Government of Germany undertaken to instruct the people in the art 
of nutrition, lest the sordid conditions of great districts should end in 
socialism, nihilism, and violent revolution ? What is the most import- 
ant department in the political questions of Europe to-day ! Is it not 
the Victualing Department ? 

It must be remembered that, in the nature of things, there must be 



40 The Indttstrial Progress of the Nation. 

a substantial equality in the daily supply of food, so far as weight and 
the elements of nutrition are concerned. If the masses of the people 
are to be well nourished, each adult person must have the due propor- 
tion of protein or nitrogenous material, of fats, and of carbohydrates or 
starchy materials, because if either one is deficient vital force cannot 
be sustained. Neither can there be any true mental vigor or spiritual 
life when the body is not well nourished. " Non est animtis aii non est 
corpus." So far as any disparity can be admitted, the workingman or 
common Li-borer requires more than any one else. His food is his 
fuel, and his physical exertion must be sustained by a sufficient supply 
with the same regularity and certainty that the boiler of the steam- 
engine must be fed with coal ; and, in fact, it Avill appear in Professor 
Atwater's future treatment of this subject that, although the standard 
rations which have been established as necessary to sustain a working- 
man in full vigor by several leading authorities in Germany, France, 
and England vary somewhat in the relative proportions of protein, fats, 
and carbohydrates, yet when reduced to calories, or mechanical units 
or equivalents of heat, they correspond almost exactly each to the 
other. He will also show that it has beq,n found expedient for the 
employers of labor in certain brickyards of Massachusetts and Con- 
necticut to serve their workmen with a supply of the best food which 
represents in its chemical proportions, as well as in its calories, twice 
the ration which is served to the soldier of the German army when 
upon a forced march, or when engaged in the most arduous struggle of 
active service in war, in order to promote the largest production of 
brick per man at the lowest cost to the employer. 

The actual production of the principle element of food in the 
United States, to wit, the grain crop, has been given. Attention has 
also been called to the perfection to which the mechanism of distribu- 
tion has been brought. 

A few words may now be given to the use of land — the source of 
nearly' all our food. The arable portion of the United States is com- 
puted at more than one half the total area of 3,000,000 square miles, 
omitting Alaska. Of this portion only 282,500 square miles are yet 
put to actual use in the production of grain, hay, roots, or other articles 
of food, omitting only that proportion of animal food which beasts 
derive from pastures. The several areas of arable, pasture, and moun- 
tain land are given below, and in the portion set off as pasture-land are 
given the areas which might suffice for a much larger production of 
beef, dairy products, mutton, and wool than we now enjoy, if known, 
methods of agriculture were intelligently applied to these arts. 

In the accompanying diagram the outer square indicates the total 
area of this country, omitting Alaska, substantially 3,000,000 square 
miles. This square has been subdivided into three parts. The upper 



The Food Question in America and Europe. 



41 



half or section represents, in a rough-and-ready way, the arable land of 
the country. What is called arable land really constitutes a larger 
portion, but one half at least may be called fairly good land.' 

The lower half is divided into two sections. One of these sections 
fairly represents pasture or grazing land, too dry for agriculture with- 
out irrigation, but capable of sustaining great flocks and herds. The 
other portion is assigned to mountain and timber. But even this part 
has many fertile valleys, and much of it may be made use of for the 
production of food. 

OUR NATIONAL DOMAIN. 

WHAT WE HAVE DONE WITH IT, AND WHAT WE MIGHT DO WITH IT. 



Section i. Akaule Land — 1,500,000 Square Miles. 



IN ACTUAL USE. 



1 ^ ui 

t: "5 — 

3^ 

.1 8 S- 



. ^ 6 

ffi o 

8 8 

2. o' 



302,500 square miles now produce all our grain, hay, cotton, sugar, rice, and garden vegetables. 



Section 2. Pastuke-Land 



WHAT MIGHT SUl-T-lCE. 



(A square mile = 640 acres.) 



Section 3. 
Mountain and Timber. 



Compiled from the records of the Agricultural Department and other sources. 

Within the lines of the upper half, certain proportions drawn on the 
same scale as the outer square, which represents the total area, will be 
observed. These smaller sections represent proportionately the actual 
cultivation, as it now is, in its ratio to the whole. 

' The following analysis of the use of land has been previously submitted in 
" Bradstreet's " by the writer. 



42 The Industrial Progress of the Nation. 

CORN AND PORK. 

Our average crop of Indian corn ranges from 1,800,000,000 to 
2,000,000,000 bushels. At twenty-five to thirty bushels to the acre, the 
area of the cornfield is only 112,500 square miles, or less than four per 
cent, of the total area of the country. Our customary average is less 
than thirty bushels, but on the best land fifty bushels are commonly 
produced, and sometimes one hundred. Corn may be reduced to pork 
at the ratio of about one bushel to ten pounds, including waste. 



About 60,000 square miles are all that are required or are now under 
cultivation in wheat.. At only thirteen bushels to the acre, this little 
patch, constituting but two per cent, of our total area, would yield 
500,000,000 bushels of wheat. This quantity, after setting aside enough 
for seed, would supply 80,000,090 people with their customary average 
of one barrel of flour per year. 

HAY. 

A hay crop of 40,000,000 tons, at the average of a good season, one 
and a quarter tons per acre, calls for less than two per cent., or 50,000 
square miles. 

OATS. 

The oat crop of between 500,000,000 and 600,000,000 bushels, at 
thirty bushels to the acre, calls for one per cent, or 30,000 square 
miles. 

COTTON. 

While the cotton crop has never reached 20,000 square miles, or two 
thirds of one per cent, of the entire area of the country (less than two 
and a half per cent, of the area of the strictly cotton States), yet on 
this little patch, at the beggarly crop of one half to three fifths of a 
bale to the acre, 6,000,000 to 7,000,000 bales can be made each year. 

MISCELLANEOUS. 

Lastly, all our miscellaneous crops of barley, hay, potatoes, and 
other roots, of rice, sugar, tobacco, hemp, and garden vegetables, are 
raised on one per cent, of our area, or 30,000 square miles. 

POSSIBILITIES. 

It is perfectly safe to affirm that, were a reasonably skilful mode of 
agriculture generally applied to these crops, the area now under culti- 
vation would yield all that could be required by double the present 
population of the United States, and would yet leave over as much as 
we now export. 



The Food Questioit in America and Europe. 43 

In the square which has been set aside to represent pasture-land 
certain subdivisions have been made which represent what rnight be 
done with the land, not what is done with it. Our cattle truly roam 
over a thousand hills and over wide plains, under the worst possible 
conditions for the best production of meat, or even of dairy products. 
When an intelligent and an intensive system of farming shall have been 
adopted, and when each one of the Eastern States (with the possible 
exception of Delaware and Rhode Island) shall produce within its own 
limits all its own meat and its own dairy products (as may soon hap- 
pen), the area set off for beef, dairy, mutton, and wool will more than 
suffice. 

BEEF. 

The area assigned to beef is 60,000 square miles. This would yield 
each year one two-year-old steer to every two acres. It is now ad- 
mitted, as has been frequently proved, that sufficient green fodder can 
be made and saved in pits, under the name of ensilage, to carry two 
steers to one acre. The additional nutriment — meal from Indian corn, 
cotton-seed meal, or hay — has been already provided for in the area 
set off for these crops. At the rate of one two-year-old steer taken off 
each two acres, each adult inhabitant of the United States, counting 
two children of ten years or under as one adult, could be served with 
very nearly one pound of dressed beef per day. 

DAIRIES. 

The area set aside for dairy products is also 60,000 square miles. 
At the ratio of one cow to each two acres, fed on ensilage, cotton-seed 
meal, and a modicum of hay, there would be a yield of fifty per cent. 
more milk, butter, and cheese than the people of the United States now 
enjoy ; while the eggs, valued at the present time at not less than 
^90,000,000 a year, and probably at $1 20,000,000, could also be doubled 
in the same area. 

MUTTON AND WOOL. 

To a similar area of 60,000 square miles mutton and wool are as- 
signed. Were sheep folded and fed as they are in England and in 
some parts of this country, protected from cur dogs and properly 
nourished, wool to the amount of 500,000,000 pounds a year (which is 
more than our present entire production and import) could be readily 
produced from this little patch, together with a greater secondary 
product of mutton and lamb than we now consume. 

CONCLUSIONS. 

It may therefore be inferred that, for the present at least, there will 
be no danger of starvation within the limits of this country, or of the 



44 The Lidustrial Progress of the Nation. 

exhaustion of our land. No one yet knows the productive capacity of 
a single acre of land anywhere. When land is treated as a laboratory 
and not as a mine, subsistence may become more of a science than it 
now is, and neither prosperity nor adversity may then be attributed 
either to abundance or to lack of land. 

Tn this connection it may be well to say that the distribution of the 
farm-lands of the United States is one of the most important factors in 
the social order. In 1880 the census disclosed the following facts : 

Total number of farms 4,008,907 

Cultivated by owners 2,984,306 

Rented on shares 702,244 

Rented for money payments 322,357 

Average size of farm, acres 134 

Farms of 50 acres or less 1,175,564 

Farms over 50 and not exceeding 500 acres 2,728,973. 

Farms of over 500 acres 104,550 

From these facts it may appear that if there is want in the midst of 
plenty in our own land, and if there is any difficulty in procuring daily 
food, it may not be attributed either to lack of land, want of capital, or 
scarcity of laborers. The modern miracle of the loaves is this : One 
man working the equivalent of three hundred days in the year, or three 
men working one hundred days in the harvest season on the far plains, 
of Dakota in the production of wheat, aided by one man working 
three hundred days in milling and barreling the flour, and supplemented 
by two men working three hundred days in moving wheat and flour 
from Dakota to New York, and in keeping all the mechanism of the 
farm, the mill, and the railroad in good repair — four men's work for 
one year places one thousand barrels of flour at the mouth of the 
baker's oven in the city of New York — a yearly ration of bread for one 
thousand men and women. 

What, then, is needed in order that all alike may have their neces- 
sary equal share of food — their three to five pounds per day of grain^ 
meat, vegetables, and products of the dairy, and the like ? Is it not 
a knowledge of the alphabet of food ? Is not the missing factor in our 
material welfare to-day the want of a common knowledge of what food 
to buy, and how to cook it ? Half the mere price of life in money is 
the price of food. If we add to this the household labor in its pro- 
portion, the measure of the cost of food in terms of labor is far more 
than half the work of life. How many eight- and ten-hour men have 
fourteen-hour wives, whose work is toilsome and continuous, day in 
and day out, almost night and day, for the support of their families ! 

Although the food question is one of grave importance, even in this 
country, there can be with us no possible scarcity of food. Nearly one 
fifth part of the products of agriculture (including cotton) is exported 



The Food Question in America and Europe. 45 

to feed and clothe the people of other lands. In return for these ex- 
ports — the grain which we could not consume, and the cotton which 
we could not spin, and the oil which we could not burn, because there 
is enough and to spare besides — we receive our great volume of imports 
in exchange for what we export, which has been divided into the follow- 
ing proportions by the measure of value in money, according to the 
average of recent years : 

Articles of food and live animals $200,000,000 

Articles in a crude condition, which are necessary in the 

processes of domestic industry 160,000,000 

Articles fully or in part manufactured, which are used in the 

domestic arts or manufactures 75,000,000 

Total $435,000,000 

Manufactured goods ready for final consumption $130,000,000 

Articles of voluntary use which may be classed as luxuries. . 65,000,000 

195,000,000 

Total $630,000,000 

The proportion of the product of agriculture exported varies year 
by year. If the declared value of exports be compared with the valua- 
tion of all crops at the farms, it ranges from twenty to twenty-five per 
cent. A fairer comparison is to extend the farm values to the final 
values at wholesale in the principal markets. The writer applied this 
method to the census figures of 1880 with the aid of other experts. The 
conclusion was that the wholesale value of all crops at the centres of 
wholesale distribution in the census year was a little less than $4,000,- 
000,000. Of this quantity somewhat over $700,000,000 worth was ex- 
ported or over seventeen per cent. ; the proportion is now less. 

In the production and movement of the crops to the centres of dis- 
tribution 8,000,000 men were occupied, of whom seventeen per cent, or 
more, say 1,360,000, depended on a foreign market. In return we re- 
ceived imports classified as above, of which more than two thirds con- 
sisted of articles of necessity or common comfort. It is in this way 
that the interdependence of nations asserts itself in spite of the 
obstructions of time, distance, and taxes, and that in all true commerce 
men and nations serve each other, both parties making a gain in every 
exchange of product for product. 

The enormous export demand, especially of European countries, 
upon us for food, which is brought into notice by the fact of our large 
exports, brings into conspicuous observation the urgency of the de- 
mands of the victualing department, especially upon the continent of 
Europe ; while the simple fact that several European states have 
obstructed the import of provisions from this country by heavy duties, 
or have absolutely prohibited the import of our pork upon the false 



46 The Industrial Progress of the Nation. 

pretense that it is especially unwholesome, bears witness also that 
although the wages of labor in these countries are very low, yet the 
cost of the production of food, as measured by labor or in money, is 
very high. Where the product of agriculture is relatively small in pro- 
portion to the population and to the demand or purchasing power, it 
follows of necessity that the wages of labor must be very low, and the 
subsistence of the people inadequate. Only one or two examples can 
be given within the limits of this article. 

I am permitted to give the following data, which have been furnished 
me by one of the most intelligent official observers in Germany, Consul 
J. S. Potter of Crefeld, Germany, in a report on the condition of German 
agriculture." From this report I find that the income of a Prussian 
farm laborer, employed as first hand upon a large farm, whose family 
consisted of himself, his wife, and five children, all under thirteen years 
old, averaged as follows in a recent year ; 

Wages of husband $142.80 

Wages of wife in harvest time 11.90 

Value of pork and potatoes raised and consumed 47.60 

Value of goat's milk and vegetables sold 26. 18. 

Total income $228.4S 

EXPENSES. 

Wheat-bread $ 7- 14 

Rye black bread 24. 75 

Pork and potatoes (valued as before) 47.6c> 

Cheese 4-95 

Syrup 5-00 

Coffee •• 3-71 

Salt, pepper, and sundries 1.24 

Total food for seven persons for one year $94.39 

This makes a cost of three cents and seven tenths per day per per- 
son. If the five children under thirteen be computed as two and one 
half adults, making the family equal to four and one half adults, the 
average per day is only five and three quarter cents. 

In my investigations of the food question I have found no statement 
of the food supply of a thrifty workingman and his family so meagre as 
this, or at so low a co^t per capita. 

1 These reports and others of equal value have since been published among the 
consular reports issued by the State Department. Attention may well be called to 
these reports. At the request of the Secretary of State, the representatives of the great 
industries of the country prepared very careful forms of interrogatory in respect to the 
several arts on which reports were desired, including agriculture Responses to these 
questions thus prepared by experts are now being published, so that the reports of sucK 
consuls as have the capacity to report facts are becoming of great value to the student 
of social science. 



The Food Question in America and Europe. 47 

It may be interesting to give the other items of expenditure of this 
thrifty German peasant : 

Clothing $39.97 

Rent of house and three quarters of an acre of land 35-75 

Fuel and lights ,. . . 14. 24 

Oil, soap, etc '. . . 3. 71 

Meal for goat and pig 16.66 

Beer and tobacco 7- 14 

Sundries 14.28 

Making a total expenditure for a family of seven persons $226. 14 

In this same neighborhood, which is one of the most fertile parts of 
Prussia, the wages of other farm laborers who are supplied with food 
by their employers are as follows : 

First laborer per year, $71.50 with board. 
Second " " " 89.25 " " 
Third " " " 26.18 " 

Average wages per year, $44.25, or less than $4 per month with 
board. 

But when we turn to the production of a first-class Prussian farm 
and its cost, we find the product of a fraction less than ninety-one acres 
of land, which had been cultivated in a most skilful and intelligent 
manner, valued in all at $3,942.47. Part of this product consisted of 
wheat, the cost of which is given at eighty-four cents per bushel of 
sixty pounds. Another portion consisted of rye, the cost of which is 
computed at sixty-eight cents per bushel of fifty-eight pounds. 

It will be observed that although the wages of the farm laborer in 
this section average less than four dollars a month, with board added, 
the money cost of a bushel of wheat is set at eighty-four cents. In our 
great wheat-producing States and territories of the Far West wages are 
four- to five-fold, with board, and yet the cost of a bushel of wheat in 
some places is not over one half, or forty-two cents a bushel. It may 
be alleged that this is because we are converting the original fertility of 
a virgin soil into wheat, and thereby exhausting the land ; but the rule 
holds true in only a little different proportion in the wheat-producing 
counties of New York and Pennsylvania, where fertilizers are as much 
required as in Germany. Wages in these sections are as high as those 
in the Far West, while the cost of wheat in money is not over two thirds 
of that given as the cost in Germany at the farm. 

It is interesting to consider the dietary of this prosperous Prussian 
farmer. The food is nearly one half black bread made of rye. The 
proportion of meat is very small, as compared with the rations of this 
country. His family consisted of nine persons, three being children of 



48 The Industrial Progress of the Nation. 

over fourteen years of age. Their total living expenses for the year 
were $736.28, divided as follows : 

Food $300.41 

Clothing 119.00 

Fuel and light 23.89 

Beer, wine, and spirits 71.40 

Cigars, tobacco, and entertainments 47.60 

Sundries 29. 75 

School expenses, and maintenance of son in army 144.23 

Total . . ; $736.28 

The cost of food per person each day is nine and a quarter cents.' 

It is singular to compare the school expenses, the support of the 
son in the army, and the beer, wine, and spirits with the food bill. The 
food supply of this farmer, whose book accounts appear to have heen 
kept with the accuracy of a merchant, and whose method of cultivation, 
as described, might serve as a lesson anywhere in scientific agriculture, 
is less in quantity and variety, and less in cost by at least one third, as 
compared with the rations which are served in the prisons of Massa- 
chusetts. 

The significant item in this expense account is the maintenance of 
the son in the army. 

There are, of course, many other causes, aside from the military 
system of Europe, for the differences which are to be found in the 
subsistence of the people, which cannot be treated in the limits of this 
article. For instance, the relative area and population of European 
states, aside from Russia and Turkey, enter into the consideration. 
The area is about one half that of the United States, while the popula- 
tion is little more than eight-fold, the ratio to the square mile being a 
little less than twenty in this country and one hundred and sixty in 
Europe. 

This area is divided into fifteen empires, kingdoms, or states, 
omitting the petty states of eastern Europe, which are separated from 
each other by differences of race, creed, and language. Their com- 
merce is obstructed among themselves by as many different systems of 
duties upon imports as there are states. The natural outlet for the 
crowded population of central Europe might be in southern Russia and 
in the fertile sections of Asiatic Turkey, were the relations of these several 
states to the eastern country the same as those of the Eastern States of 
this country to those of the West. There is land enough, and to spare .; 
but the armies of Europe are sustained in order to prevent this very 

' For further comparisons of the food supply of working people in different 
countries, reference may be made to the first report of the National Bureau of the 
Statistics of Labor, by Hon, Carroll D. Wright. 



The Food Question in A merica and Europe. 49 

expansion of the people ; and the misgovernment of the Turk, which 
renders Asia Minor ahnost a howling wilderness, is protected by the 
mutual jealousies of these very states, which are thus being destroyed 
by their own standing armies. 

As war becomes more scientific, it becomes more costly. Victory 
rests not only on powder and iron, but yet more on bread and beef. It 
may have been the German sausage by which France was beaten, quite 
as much as the German rifle. 

The food question in Europe may be one of possible revolution 
and repudiation of national debts, and of the disruption of nations as 
they now exist ; and to this branch of the victualing department atten- 
tion may well be called, because its conditions are so greatly in contrast 
to those of the United States ; but this phase of the question will be 
treated separately in a subsequent article. May we not find in these 
costly armies, excessive debts, and excessive taxes not only the cause of 
pauper wages, but also the cause of the ineffectual and costly quality 
of so-called " pauper labor " ? May there not also be found in these 
figures incentives to socialism, to communism, and to anarchy ? What 
hope for men and women, the whole of whose product would barely 
suffice for subsistence, when ten, twenty, and perhaps even thirty per 
cent, is diverted from their own use, and even food is denied them 
sufficient to maintain health and strength, in order that these great 
armies may be sustained ? 

The victualing department is therefore presented in these three 
phases : 

First. In our own country the only question is how to save the 
waste of our abundance, and how to teach not only the working people, 
but even the prosperous, the right methods of obtaining a good and 
wholesome subsistence at less cost in money than they now spend for a 
poor and dyspeptic one. 

Second. In Great Britain and Ireland the victualing department 
underlies a system of land tenure which is now on its trial, and which 
has led to such artificial conditions that great areas of good land have 
been thrown entirely out of cultivation, while half the people are being 
fed from fields from five thousand to fifteen thousand miles distant. 

Third. Upon the continent of Europe the victualing department 
stands face to face with a forced method of distributing and wasting a 
food-product which, as a whole, is insufficient to maintain the whole 
population in vigor and health even if it were evenly distributed, as 
food must be equally distributed by weight if not by quality, in order 
that men and women may be equally well nourished. 

When a famished democracy becomes conscious of its power, what 
will be the end of privileges which are not founded on rights, and of 
national debts which have been incurred by dynasties without the 



50 The hidustrial Progress of the Nation. 

consent of the people who are now oppressed by them ? How will 
standing armies be disbanded, which now seem to be as incapable 
of being sustained as they are impossible of being disarmed ? 

Such are some of the appalling questions to which we are led when 
we attempt to analyze the way in which men, women, and children now 
obtain the modicum of meat and bread which they must have every 
day in order to exist, and that daily ration of dairy products, of fruit, 
of sugar, and of spice, which is needed for common comfort. 

There is but one element of life which all have in common, and that 
is Time. Who can teach us how to use our time so as to obtain the 
substantially even weight of food which is necessary to the adequate 
nutrition and to the common welfare of rich and poor alike ? 



THE RELATIVE STRENGTH AND WEAKNESS 
OF NATIONS 

TWO STUDIES IN THE APPLICATION OF STATISTICS TO 
SOCIAL SCIENCE 



THE RELATIVE STRENGTH AND WEAKNESS OF 

NATIONS.' 

TWO STUDIES IN THE APPLICATION (JF STATISTICS TO SOCIAL 

SCIENCE. 

1. STKENGTII. 

FROM one of the little-known but very remarkable financial essays 
of Pelatiah Webster, a patriot merchant of the era of the Revo- 
lution, who most urgently resisted the issue of the Continental 
currency, predicting all the malignant effects which ensued therefrom, 
we quote these words : 

" I conceive very clearly, that the riches of a nation do not consist in the abun- 
dance of money, but in number of people, in supplies and resources, in the necessaries 
and conveniences of life, in fjood laws, good public officers, in virtuous citizens, in 
strength and concord, in wisdom, in justice, in wise counsels an<I maidy force." 

As tlie century is now just ended since the first steps were taken to 
frame the (Constitution under which we live, it may be fitting to account 
to ourselves for the work which has been done during this hundred 
years in the land wherein we dwell. 

We may, perhaps, test the wisdom of our laws and the equity of 
our institutions jjy measuring the development of our resources, the 
abundance of our supplies, and the strength of our nation. Our na- 
tional domain is a trust with which we have been endowed. How 
have we discharged the trust ? 

The main source of all material life is land. The sea supplies food 
in small measure, but upon the land mankind almost wholly depends. 
May not that system of land-tenure and that form of government, 
therefore, be considered best which has resulted in the largest produc- 
tion and in the most equitable distribution of the products of the 
soil ? May we not claim this position among the nations ? 

Is not the (miy equitable distribution of the materials re([uired for 
food a substantially even one by weight ? There may be a great differ- 

' Reprinted with additions from '/'/w Century Magazine for January, 1887. 

53 



54 



The Industrial Progress of the Nation. 



ence in the quality, but the requirement for nutrition is the same among 
rich and poor alike ; each adult person should have substantially the 
same quantity of the chemical ingredients of food or " nutrients " 
by the conversion of which the body is sustained, and which are de- 
rived from animal and vegetable food. 

OUR NATIONAL DOMAIN. 

WHAT WE HAVE DONE WITH IT, AND WHAT WE MIGHT DO WITH IT. 



Section i. Arable Land — 1,500,000 Square Miles. 




IN ACTUAL USE. 






Corn and Pork. 

1,900,000,000 bushels. 

112,500 sq. miles. 


Wheat. 

500,000,000 bushels. 

60,000 sq. miles. 


Hay. 

40,000,000 tons. 
50,000 sq. miles. 


n 

8° 
^ 


. 
0' 


§1 
s 






I. IL III. IV. V. VI. 


' 


302,500 square miles now produce all our grain, hay, cotton, sugar, rice, and garden vegetables. 


Section 2, Pasture-Land. 




WHAT might suffice. 








■g 


■g 




Section 3. 












Mountain and Timber. 




.8" 


£ ' 




8 








VIL VIIL IX. 




(A square mile = 640 acres.) | 





Compiled from the records of the Agricultural Department and other sources, in November, 18 



There can neither be matured strength in the man nor in the na- 
tion without an adequate supply of food ; on the other hand, the very 
existence of the almshouse and the pauper asylum in civilized coun- 
tries bears witness to the admitted necessity of a substantially equal 
distribution of food by quantity or by weight. 



Tlie Relative Strength and Weakness of Nations. 55 



OUR NATIONAL DOMAIN. i 

GRAPHICAL PRESENTATION OF THE COMPARATIVE AREAS OF THE STATES AND TERRITORIES OF THK 
UNITED STATES AND THE COUNTRIES OF EUROPE, OMITTING RUSSIA AND ALASKA. 

[Corrected from the revised computations of the United States Census of 1880, and the Statesman's Year Book of 1887.] 



Name. 



Sq. Miles. 



1. Texas 262.290 

2. Austrian Empire . . . 240.942 

3. German Empire . . . 211, 149 

4. France s-.^.T? 

5. Spain 197.7^ 

6. Sweden 170.973 

7. California 155.980 

8. Dakota Territory . . 147. 7«) 

9. Montana Territory . . 145,310 

10. Norway 123.205 

11. New Mexico Territory, 122,460 

12. Great Britain & Ireland, 120.832 

13. Italy 114,410 

14. Arizona 112,920 

15. Nevada 109.740 

16. Colorado 103,645 

17. Wyoming Territory . . 97,575 

18. Oregon 94.5^ 

19. Idaho Territory . . . 84,290 

20. Utah Territory . . . 82,190 

21. Kansas 81.700 

22. Minnesota 79.205 

23. Nebraska 76.185 

24. Indian Territory . . . 69.830 

25. Missouri 68,735 

26. 'Washington Territory . 66,880 

27. Turkey in Europe . . 63.850 

28. Georgia 58.980 

29. England and Wales . 58.186 

30. Michigan 57.430 

31. Illinois 56.000 

32. Iowa 55,475 

33. Wisconsin 5445^ 

34. Florida 54. 25^* 

35. Arkan'ias 53,045 

36. Alabama 5' ,540 

37. North Carolina . . . 48.530 

38. Roumania 48.307 

39. New York 47.620 

40. Mississippi 46.340 

41. Louisiana 45.420 

42. Pennsylvania .... 44.985 

43. Tennessee 41,750 

44. Ohio 40.760 

45- Virginia 40.125 

46. Kentucky 40.000 

47. Portugal 36,028 

48. Indiana 35.910 

49. Ireland 32.531 

30. South Carolina . . . 30.170 

51. Maine 29.875 

52. Scotland 29.820 

53. Greece 25.014 

54. West Virginia. . . . 24,645 

55. Bulgaria 24.369 

56. Bosnia & Herzegovina, 23.570 

57. Servia iS.Bco 

38. Switzerland .... 15.892 

59. Denmark 14.124 

^. Eastern Roumelia . . 13.500 
61. Netherlands .... 12.648 
^. Belgium ii,373 

63. Maryland 9,860 

64. Vermont 9,i35 

65. New Hampshire . . . 9.005 
^6. Massachusetts .... 8,040 

67. New Jersey 7.455 

68. Connecticut 4.845 

€9. Montenegro 3.550 




70. Delaware 

71. Rhode Island . . . 

72. Andorra 

73. District of Columbia 

74. Monaco 



:.c6o 

1.C85 

175 

60 



Relative area : United States solid, Europe open. 



Relative Popul.a.tion of Countries at the Dates 
' OF the Last Census taken in Europe 

AND OF the United States.* 

(At the date of the publication of this volume, in 1889, the population 
of the United States may be computed at somewhat over 63,000,000.) 

Russia 85,296,479 ) 
Finland 2,176,421 J *7"'7^'9°° 
United States, 
July 4, 1887 . .60,000,000 



German Empire . 46,852,450 

Austrian Empire . 37,882,712 

France .... 37,672,048 
Great Britain and 
Ireland . . . 36,325,115 



Italy 29,361,032 

' Spain 16,961,742 

Turkey in Europe . 4,668,0001 
Bulgaria&E.Roumeiia,2,982,949 >8,987,040 
Bosnia & Herzegovina 1,336,091 ) 




Belgium 



Portugal 



Switzerland 

The visionary possibilities of the future product of 
the United States may be imagined by reference to the Denmark i 080 253 

following statement : -.••:/. jj 

The land in actual use for growing maize or Indian 

com, wheat, hay. oats, and cotton in the whole country Greece 1,979,561 

now consists of^282.5oo square miles, or a little more than 
the area of the single State of Texas. 

The entire wheat crop of the United States could be S^"^^'^ 1.952,35' 

grown on wheat land of the best (juality selected from that 

part of the area of the State of Texas by which that single jjorway 

State exceeds the present area of the German Empire. 

The cotton factories of the world now require about ., 
12.000.000 bales of cotton of American weight. Good Montenegro . . . 250,000 
land in Texas produces one bale to an acre. The world's 

supply of cotton could therefore be grown on less than . , 

19,000 square miles, or upon an area equal to only 7 per • Authority : Almanach de Gotha, except where later figures are given In 
cent, of the area of Texas. other compilations. 

' Reprinted from the Century Magazine for January, 1887. 



. 5.85.3278 



, 5.376.000 



• 4,306,554 



;, 846, 102 



■ i,93i.< 



56 The Industrial Progress of the Nation. 

Raw land, if such an expression may be used, itself possesses no 
more value than free air or running water. A price may be paid, or a 
contest may be waged for a time, in order to secure the opportunity to 
reap and dispose of the harvests which are due to original fertility ; 
but, with very rare exception, the virgin properties of the soil are soon 
exhausted, and what is known as " economic rent " almost wholly dis- 
appears ; then land ceases to be a mine and becomes a laboratory, 
only yielding product, and therefore only yielding wages and profits, 
according to the measure of the labor put upon it, of the capital put 
into it, and the intelligence with which both capital and labor are di- 
rected. 

At last land may cease to yield either wages or profits in response 
to labor and capital unless both are combined under the direction of 
skill and experience. 

There is no absolute private ownership of land in this or in any 
other civilized country, yet limited possession is necessary to its use 
and to its production. When subject to such limited possession it be- 
comes useful and valuable. 

All systems of land-tenure which tend to limit or retard production, 
so that even a slowly increasing population gains upon the means of 
subsistence, may be rightly subject to change. Or if, after the prod- 
uct of the land has been made in sufficient measure for the welfare of 
the people who dwell upon it, it is then so wrongly distributed that a 
considerable part is wasted in the support of standing armies or dynas- 
tic privileges, while great numbers of people suffer from absolute want, 
it will only be a question of time when such forms, systems, or institu- 
tions must give place to others, either by peaceful evolution or by 
violent revolution. 

The purpose of these studies is to treat the present relative condi- 
tions of the so-called civilized nations of Europe, and to compare them 
with the conditions of the United States, in respect to the production 
and distribution of the means of subsistence which are wholly derived 
from land. 

It is proposed to apply the test of such a balancing of accounts as 
a business man is accustomed to call for when any corporate enterprise 
is subjected to his scrutiny. The work of States may be considered 
in the nature of a corporate enterprise subject to the control of the 
people who are members of the corporation, as they may choose to 
direct. 

At the same time, all such direction by statutes, and all customs 
which precede or attain the force of law, must be brought into harmo- 
ny with a true science of law if they are to be permanent, else they will 
only create confusion and become inoperative. It may be said that no 
true science of law has yet been established among men : then the 



The Relative Strength and Weakness of Nations. 5 7 



POPULATION OF THE UNITED STATES, 

Either as Enumerated in the Census or as Computed 

BY Mr. E. B. Elliott, Actuary of the 

Treasury Department. 

June I. 



more reason to test the present condition of nations which claim to 
be governed by law, in order to determine by a comparison of their 
conditions which one has attained the best results, so that a basis may 
be laid for a true inductive science of law governing the social order, 
fully consistent with the higher law which governs the universe. 

As regards land, the 
continent of Europe and '• 

the territory of the United 
States are about even. 
The area of Europe, in- 
cluding all of Russia, is 
3,761,657 square miles. 
The area of the United 
States, including Alaska, 

is 3,501,404- 

If we omit in Europe 
the uninhabitable portions 
of Norway, Sweden, and 
Russia, and if we omit 
Alaska from the territory 
of this country, we reach 
a substantially even pro- 
portion of habitable land, 
to wit, about 3,000,000 
square miles in each 
country. 

The population of Eu- 
rope approximates 334,- 
000,000. 

When this article is 
published, the population 
of the United States will 
be substantially 60,000,- 
000. 

If we omit Russia 
wholly from the compu- 
tation, the area of the re- 
mainder of Europe covers 
1,500,000 square miles, of 
which the population is 
about 240,000,000 



i860.. 31,443, 321 




I86I. .32,060,000 
1862. .32, 704,000 
1863. .33, 365,000 
1864. .34,046,000 
1865.. 34,748,000 




















1866.. 35,469,000 




„ 






1 867.. 36,2 1 1,000 




JJ 






1868. 36,973,000 




,1 






1869.. 37,756,000 




,, 






1870.. 38, 558,371 


E 


numerated. 


I87I.. 59,555,000 


r C 


imputed. 


1872. .40,596,000 

1873.-41,677,000 




^^ 










1874. .42, 796,000 

i875--43.95'i000 
1876. .45, 137,000 




J, 














1877. .46,353,000 
1878. .47, 598,000 




,, 




,^ 






1879. .48,866,000 
1880.. 50, 155, 783 
1881.. 51, 495,000 




„ 




numerated 
omputed. 


^C 


1882.. 52,802,000 
1883.-54,165,000 




" 






1884. .55,556,000 
1885. .56,975,000 




^^ 










1886.. 58,420,000 




- " 


1887.. 59, 893,000 




— " 


1888. .61, 394,000 
1889. .62,921,000 




., 


" 


1890.. 64,476,000 




— .i 



58 



The Indttstrial Progress of the Nation. 



MILES OF RAILWAY IN OPERATION IN 
THE UNITED STATES 

On the first of January in each year, begin- 
ning 1865. Compiled from Poor's 
Railway Manual. 



The average number of 
men employed per mile of 
railway in the census year 
was alittleunderfive. With 
the increase of traffic, it is 
doubtless a little over five 
' now. I'he executive force 
.of all the railways therefore 
numbers about 650,000 men. 

— The construction of 
railways in 1886 will 

probably exceed 6000 

miles, at about $25,- 

000 per mile, or at 

sixty men per mile, 

earning each an 

____^^_ average of a lit- 
tle over $400— 

■ therefore repre- 
_^__^___ senting a con- 
struction force of 
about 350,000. 



1866. 
1867. 



1870. 
1871.. 
1872.. 
1873., 
1874.. 
1875.. 
1876., 
1877.. 
1878.. 



,096 



1879.. 81,776 



1880. 



1885. 



86,497 

93i545 
103-334 
114,925 
121,543 
125,379 
128,967 



One million men are therefore occupied at this time 
either in the construction or operation of the rail- 
ways of the United States. 



Capital stock $3,817,697,832 

Funded debt 3,765,727,066 

Other debt 259,108,281 

total. 

Passenger receipts .... $200,883,911 

Freight receipts .... 519,690,992 

Total, including miscellaneous . 765,310,419 

The railway mileage Jan. i, 1881, was 93,545. In a 
treatise upon what would be an adequate service, 
written in that year, the writer said that 117,500 
miles should be added in the next fifteen years ; but 
as we should have at least one commercial crisis and 
railway panic during that period, it might be safer to 
assign twenty years to the work. Since Jan. i, 1881, 
we have had both a crisis and a panic, but we have 
added 35,422 miles, leaving only 82,025 for the next 
eleven to fifteen years. 

The increase in the railway mileage of the United 
States subsequent to the publication of this article in 
The Century^ gives the following results, actual and 
estimated . 



miles ready for operation. 



Jan. 



90 (Estimated) 



137,987 

149.913 
156,613 
164,000 



III. 



CHARGE PER TON PER MILE 

For moving Merchandise over the New York 
Central and Hudson River Railroad, at 

THE average, in EACH OF THE SEV- 
ERAL YEARS DESIGNATED. 



1855. .3. 270 gold. 

186S..3.4S1 paper 
1866.. 3.092 " 



1867, 


2.754 


1868. 


2.742 


1869. 


2.387 


1870. 


1-853 


I87I. 


1.649 


1872. 


1.592 


1873. 


•1-573 


1874. 


1.462 


1875. 


1-275 


1876. 


.1.051 


1877. 


1. 014 


1878. 


• -93° 


1879. 


.796 


1880. 


■ -879 


I88I. 


- -783 


1882. 


• -738 


1883. 


. ,910 


1884. 


. .830 



gold. 



The railway service of 
the United States for the 
last four years, 1882 to 
1885 inclusive, on the au- 
thority of Poor's Railway- 
Manual, has consisted in 
moving 1,597,058,562 tons 
of food, fibers, fabrics, tim- 
ber, metal, and fuel an av- 
erage distance of in miles 
each ton, at a charge of 
$2,052,849,085. 

The average service for 
each man, woman, and child 
of the population has been 
in moving •]\ tons of food, 
fuel, and other necessaries 
of life III miles at a charge 
of $9.35 to each person per 
year, or a fraction over 2J 
cents a day. 



The New York Central and Hudson River Railroad 
may be taken as a good example of an important line of 
railway under most efficient management, and as a stand- 
ard of what other lines may accomplish when the magni- 
tude of their traffic will permit them to make as great a 
reduction in rates. The average charge per ton per mile 
on this line from 1865 to i868, four years, was 3.0097 cents 
per ton per mile. From 1882 to 1S85, four years, the 
charge was 0.7895. Difference, 2.2202 cents. If we may 
assume that the people of the United States have been 
saved two and one fifth cents per ton per mile on the 
whole railway traffic of the last four years, either by the 
construction of railways where none before existed or by 
such a reduction in the charge for their service, the amount 
or money's worth saved in four years has been $3,898,- 
373,159, which sum would probably equal the. cash cost of 
all the railways built in the United States since 1865, to 
which sum might probably be added the entire payment 
upon the national debt since 1865. 

The following table brings into yet more conspicuous 
notice the beneficent effect of the railway system in the 
distribution of food : 



The Relative Strength and Weakness of Nations. 59 



K 
H 

0$ 

O 

s; 

Q 

< 
o 
o 
<; 
o 

£ 

g 
B 

^ Q 

< < 

% u. 

c ^ 

^< 



< < 



c o 
< < 

r- O 

Qg 

< 
O 
o 
< 

£ 
u 

J] 
o 



too-- ti 
n r = 5 






rnrorofoo « w n « 



a^ ' 



o* 



CO 






CO 



CO 



^. ■^'■^ O o«co<^i.O O_~o^co r^« ^oocooq_n-a>« r--N o^ '-^ 
O^ *^oo«-«'OOcoooQO^ mrCpTHTu-iwo •- ^c^-ci'tnocT^o^ 

wj"" fO^Coo r^■^■-^^'l^^Ol-< '*''*i-i « o'r^Oo'ocor^O^'O'vd' 

Sr^o 000 o<j t^co "-"^o w\o o c* c* «o ■<r'0 i^^oo -^ o 

6w rOfO--t''-« o M C100 r>*cioO'i?iorC«*o»-rroroooo^vcr 
(fl ^^o rpo 0^mfOiJO^'0^\o_-*rot^oo « OQO^O mm^ « 
C '>^'^*£rtCco^oo<>0'-<'crcrfnfOtnoo-*rCdiM"w'^ino^ 

O MMMMMMMMCIWdfOmnrO''*' 

H 
tl 

> 

lO^O 1^00 00 w « fO-t-iOvO tViOO O\0 m « rO-^u^vO t> 

^o>o*o^*o i^tN.r^t^t^r-.r>.t>.t*.r-^oocooococooooocx) 
oooooooooocooooooooooooooooocooooooooocooooooo 



6o 



The Industrial Progress of the Nation, 



w 



t 

s 

o 

P 

'^ i^ 
< 9 

0< 

"=^ 
W Pi 

W w 

<J H 

P^ ^ 
g P 

p; < 
o . . 

w 'A 
P w 

M >. 
g^ 

o ^ 

w p 
g 2; 

I-' <l 

w z 

o Iz; 
Oh 
<: o 
w^ 
i^ J' 

^^ 

ft! W 

H .. 
Ph p^ 

w 

<! O 
►> w 

I-) 
>< 

iz; 
w 



j2 S; I- o 

O p.g.c 



O fO 00 rj- VO M 

I ^ a> t^ o i>. " 



HOOVO Osro-^ChO'O MOO 



ra 


?? 


t^ 


^ 


S 








2 


l^ 


vS" 


s 





!n 


t> 





o. 


S 





S 


M 


Ov 


?> 


>:t- 


m 


5- 


^O 


t^ 


s 


00 


H> 


vS^ 


«3 
O 


\o 


^ 


t^ 


0^ 


1 




S" 


8 


VO 

o 


t^ 


s> 


O 


^ 


Jo 




f 


" 


^ 


o\ 


VO 


1 


■§ 


^ 


CO 


s 




^O 


00 


R 


m 


v8 


OV 


VO 




m 


Ov 


■* 


M 


N 


« 


N 


ro 


m 


Tf 


lO 


in 


lo 


in 


VO 


VO 


ts 


0^ 





" 


M 


H 





M 


H 


ro 



5^ 



• o o loa^iofoin-'i-t^ioiovo tv.M <n o h o o^ mo c>. 

yjXJ t-^'O -^MD w M q\fOW_H_'^OOVO^VO N Ti-H 0*0 irjH^o in 

Cj^M"a\'^co'^'o"\o"oo '^r--.o\vovoro'^iotCvo"arintCw tC-^ 
O^ lO-til-Chvo irttnONrnH o\m>o roNoo mn tj-c7«on m m- 

S M"-<fiocCo'H'inoo'"cfc^wvoio"c>ocrfOM'-<t'o"'+vo"^-^ 
M M M H M N w cs mfnrororofO'^invo\ovo\o»o r^oo 

rt . I . ! ! ! . ! . ! ! . ! . I .' ! I I I I ! I 
u 

> :.:.::: 

mvo t^OO O\0 tH c) rO"^lO»0 t^OO OO M N r^itmvo h*. 

"O^^vovo t^t^r^o.t~^t^t^t>st->r^oooooocooooooooo- 
oooooocooococooooooooocooocooooooooooooooooooo 



The Relative Strength and Weakness of A^ations. 6 1 



IV. 

GRAIN CROPS OF THE UNITED STATES. 

Maize or Indian Corn, Wheat, Rye, Barley, Oats, and 

Buckwheat. From the Reports of the United 

States Department of Agriculture. 



The population of the United States is now a fraction under twenty 
to the square mile ; while that of Europe, aside from Russia, is about 
i6o. But there are many portions of the eastern section of the country 
which are as densely populated as any of the European States, with the 
single exception of Belgium. 

The low cost of the railway service in the United States makes the 
distance between the farm and the factory of very little consequence 
so long as there are no artificial obstructions to commerce. The whole 
country is one great neighborhood in which each man serves the other; 
and this is its true strength. The wages for one day's work of an 
average mechanic in the far East will pay for moving a year's sub- 
sistence of bread and meat a thousand miles or more from the distant 
West. 

On the other hand Europe is filled with obstructions to commerce 
which are far more diffi- 
cult to surmount than that 
of distance. 

In other conditions 
aside from land there is 
a considerable similarity 
between this country and 
Europe. Until a very re- 
cent period more than 
one half the territory of 
Europe was still kept back 
in its progress by the serf- 
dom of the peasantry of 
Russia ; while nearly one 
half the territory of the 
United States which had 
been occupied before the 
opening of the Civil War 
was kept back in its mate- 
rial progress by slavery. 

Again, there is as great 
a difference in the rel- 
ative conditions of soil 
and climate, and in the 
physical conformation of 
the land — as great a differ- 
ence between the moun- 
tains and plains, of the 
United States, as there is 
in Europe. 



i86s 


. 1,127,499,187 


1866 


. 1,343,027,868 


1867 


■ 1,329-929.400 


1868 


. 1,450,789,000 


1869 


. 1,491,412,100 


1870 


. 1,629,027,600 


1871 


. 1,528,776,100 


1872 


. 1,664,331,600 


1873 


. 1,538,892,891 


1874 


• i,455ii8o,200 


1875 


. 2,032,235,300 


1876 


. 1,962,821,600 


1877 


. 2,178,934,646 


1878 


. 2,302,254,950 


1879 


• 2,434x884.541 


1880 


. 2,448,079,181 


1881 


. 2,066,029,570 


1882 


• 2,699,394,496 


1883 


. 2,623,319,089 


1884 


. 2,982,246,000 


1885 


. 3,014,063,984 



The close coincidence between the increase in the miles of 
railway constructed and the bushels of gram produced will be 
observed. 

It may be held that by the construction of railways in 
advance of the population a great rise in the value of fertile 
land in the East has been retarded and the increased product 
of the Western farmer has been rendered possible ; while 
under the land-grant system, land which might otherwise 
have been sold in large parcels has been broken up into small 
farms by the reservation of alternate sections. Under this 
influence, a superabundant supply of food has been produced 
by a less proportion of the population occupied in agriculture 
in 1885 than in 1865. 

The grain crops of the United States subsequent to the 
publication of this article have been ; 

1886 . 3,015,439,000 bushels 

1887 . 2,649,613,000 ,, 

1888 . 3.200,000,000 ,, estimated in part. 

If the early promise of the season of 1889 is maintained, the 
crop of grain will be the largest ever grown, both absolutely 
and in ratio to population. 



62 



The Industrial Progress of the Nation. 



V. 

PRODUCT OF GRAIN PER CAPITA. 

And Ratio of the Increase of Grain to the 

Increase of Population. 

Bshls. Ratio to 



The relative differences in the conditions of the people of the several 
states of either continent must therefore be sought in some other cause 
than in the physical geography or the climatology of the two continents. 
Reference may perhaps be made to the difference in language and 
in creed in Europe. But it must be remembered that the settlers who 
have occupied the United States formerly differed as much as the 
people of Europe in these matters ; yet the common school of this 
country has proved, or is proving, to be the solvent of race, creed, 
language, color, and condition, and is rapidly merging the whole popu- 
lation, so far as the conditions of material welfare are concerned, into 
one single and substantial body-politic, as firmly bound together as if 
all the people had been strictly homogeneous. 

It is not, however, the purpose, nor would it be within the ability 
of the writer, to attempt any general treatment of the profound differ- 
ences which have brought the 
greater part of continental Eu- 
rope either to actual or prospec- 
tive national bankruptcy, and in 
some places to such abject con- 
ditions of want as may perhaps 
account for the conditions of 
socialism, communism, nihilism, 
and anarchy. These phases of 
resistance to social order as now 
established may perhaps be 
deemed only the reflex or com- 
plement of despotism or of dy- 
nastic privileges, and of misap- 
plied and misdirected national 
greed as yet unenlightened as to 
what is the true source of the 
wealth of nations. 

The business man who at- 
tempts to comprehend the causes 
and effects of existing conditions 
may well leave the philosophy of 
the subject to the student and to 
the statesman ; but perhaps such 
a one can apply common busi- 
ness methods of account to the 
conditions of the present, and by 
sorting assets and liabilities and 
striking a trial balance of the 
accounts of the several civilized 



Date. 


per 
head. 


popu- 
lation. 


i86s . 


■ 32.50 ■ 


. 1. 00 


1866 . 


. 37-80 . 


. 1. 16 


1867. 


• 36.73 • 


. 1. 13 


1868 . 


• 39-3° 


. 1. 21 


1869 . 


• 39-44 


. 1. 21 


1S70 . 


. 42.24 


. 1.30 


1871 . 


. 38.64 


. 1. 19 


1872 . 


. 41.00 


. 1.26 


1873. 


. 36.90 


- 1-13 


1874. 


. 34-00 


. 1.05 


1875 • 


. 46.19 


. 1.42 


1876. 


• 43-50 


• 1-34 


1877. 


. 47.00 


• 1-44 


1878 . 


- 48-37 


• 1-49 


1879. 


. 50.20 


• 1-54 


1880 . 


. 48.80 


. 1.50 


1881 . 


. 40.00 


• 1-23 


1S82 . 


. 51.12 


• 1-57 


1883 


. 48.40 


• 1-49 


1884 


- 53-68 


- 1-65 


18S5 


• 52-50 


. 1.60 



The increase in the per capita product of grain 
does not show as conspicuously on the chart as the 
absolute increase, but it gives even greater evidence 
of progress in common welfare. A less proportion of 
the population is now occupied in agriculture, and 
especially in the production of grain, than was re- 
quired at the beginning of this period, while the sub- 
stitution of machinery for the arduous handwork of a 
former day has greatly relieved the severity of the 
toil, and rendered the harvest much more certain. 



The Relative Strength and Weakness of Nations. 63 



states of the world, he may perhaps throw a little light upon problems 
which students and statesmen alike now seem to be incapable of solving. 

There can be no question that the 3,000,000 square miles of habit- 
able land in Europe, taken as a whole, could sustain in peace and 
plenty a very much larger population than now exists thereon, if the 
relations of the people among themselves were the same as the rela- 
tions of the people of the several States of this Union to each other. 
The potential of subsistence in Europe has not yet been approached. 

Again, if there were no greater obstruction to mutual service be- 
tween the people of Asia Minor and of North Africa, especially Egypt, 
than now exists or may soon exist between the United States and the 
Dominion of Canada, an absolute abundance of food, fibres, fuel, and 
materials for shelter, upon which material life and welfare depend, 
would be assured to as large a population in Europe as the absolute 
but visionary figures of our census bring into prospective view upon 
this continent a century hence. 

If such are the natural conditions, then the social and political dif- 
lerences must be weighed in the trial balance of nations by their mate- 
rial results. We will set off democracy against dynasties in figures and 
by the facts of life. 

In the attempt to bring into comparison the absolute weakness of the 
states or nations of Europe 
whose chief strength is now 
assumed to be in their armies 
and navies, I have used 
tables showing the progress 
of the industries and arts 
upon which our own mate- 
rial welfare chiefly rests, 
dating from 1865 to 1885, 
inclusive. Several of these 
tables have been previously 
used in other publications, 
but they are now brought 
down to the latest dates and 
grouped together in such a 
way as to show their real 
significance. 

In Europe we find nine- 
teen separate and partly or 
wholly independent nations or 
states, nearly all governed 
by dynasties, with the excep- 
tion of Switzerland. Even 



HAY CROP OF THE UNITED STATES. 

From the Statistics of the Department of 
Agriculture. 





Tons. 


1865 . 


• 23-538,740 


1866. 


. 21,778,627 


1867. 


. 26,277,000 


1868. 


. 26,141,900 


IS69. 


. 26,420,000 


1870. 


. 24,525,000 


I87I . 


. 22,239,400 


1872 . 


. 23,812,800 


1873. 


. 25,085,100 


1874. 


. 24,133,900 


1875. 


. 27,873,600 


1876. 


. 30,867,100 


1877. 


. 31,629,300 


1878. 


. 39,608,296 


1879. 


• 35,493,°°° 


1880. 


■ 31,925,233 


I88I . 


• 35,135,064 


1882. 


• 38,138,049 


1883. 


. 46,864,009 


1884. 


• 48,470,460 



The hay crop at the farm is worth much more than the 
cotton crop at the factory. 

Food costs the average family three to four times as 
much as clothing. The combined value of the poultry 
and eggs only which are annually consumed is computed 
at $200,000,000. This is more than the value of the pro- 
duct of pig-iron,silver bullion, and the wool-clip combined. 



64 



The Industrial Progress of the Nation. 



in republican states ^^^- 

like France, the dynas- product of pig-iron in the united states. 

Compiled from the Records of the Iron and Steel 

tic method has not yet association. 

been displaced by local 
self-government in any 
true sense of that term, 
while in Great Britain, 
which in some respects 
is more democratic than 
the United States, or is 
rapidly becoming so, a 
feudal practice of land- 
tenure remains in force 
and the paternal form 
of government yet dom- 
inates internal affairs, 
although it has been 
almost wholly thrown 
off in respect to for- 
eign commerce. This 
centralized system ap- 
pears to be now culmi- 
nating in the final strug- 
gle of the English 
Parliament to relieve 

i + colf /->■(" rlnfi/=>c ^jrlTiVVi The ascertained or estimated production of pig-iron subsequent to 
llbeil OI UUlieb WiUCa the publication of this article has been ; 

have become almost ^^se . . 6.365,328 tons, 

1887 . . 7,187,206 
impossible, and to rele- ''f^ ■ ■ 7,268,507 '' , , , , ,, 

^ ' - 1889 . . Estimated by Mr. Swank at about the 

same number of tons as in 1888. 

The production of pig-iron is an arduous and somewhat undesirable occupation, giving employ- 
ment at the present date, 1889, in this country to about 150,000 men and boys. On the other hand, 
this relative consumption of iron and steel is one of our surest standards by which the progress of a 
nation in material welfare may be measured. 

The production of iron and steel in this country has not sufficed to meet the demands at several 
periods during the last twenty-five years when railway construction has been active — especially in 
the last decade. The production of pig-iron for the years 1879 to 1888 inclusive amounted to fifty-two 
and a quarter million tons of 2,000 lbs. each ; the consumption in the same period has been over si.xty 
million tons, two thirds consumed in the form of iron, and one third in the form of steel. This con- 
sumption was equal to nearly thirty per cent, of the entire production of the world during this period, 
and in 1887 our consumption of 300 lbs. per capita was equal to nearly forty percent, of the production 
of the world. 

The prices of iron and steel have been steadily falling, subject to occasional upward fluctuations, 
since 1865, both in this and all other countries, and with the reduction the use of iron and steel for 
various purposes other than railway construction has steadily increased. 

While the absolute price has thus been reduced, the relative disparity or difference in price in the 
United States as compared to other countries has increased. From 1879 to 1888 inclusive, the relative 
difference paid by consumers in this country has averaged $7 per ton on iron and $7 per ton addi- 
tional on steel taking Bessemer metal for comparison. The amount of this difference paid by con- 
sumers here as compared to consumers in Great Britain has amounted to $420,000,000 on 60,000,000 
tons iron, with $140,000,000 added at $7 per ton on 20,000,000 tons converted into steel, making 
$560,000,000 in all. It is therefore not surprising that the import of machinery and other fabrics of 
metal should be increasing. The effect of our tariff has doubtless been to increase our actual prod- 
uct and perhaps to have hastened the general reduction in price both here and elsewhere, but 
the cost of this method of promoting the production of iron and steel has averaged $56,000,000 a 
year for ten years, making the total above given, which sum amounts to more than the entire capital 
now invested in all the iron mines, blast furnaces, steel works, and rolling mills now in existence 
in this country. Whether this method of promoting the domestic production of iron and steel has 
been worth what it has cost is a question which must soon be considered. 



Estimate of 1886, given 


by courtesy of the Secretary, Mr. James M. 
Swank. 


Tons of 2,000 lbs. 






1865 . . 931,582 

1866 . . i,3SOi343 

1867 . . 1,461,626 
1B68 . . 1,603,000 
1869 . . 1,916,641 




^~ 












1870 . . 1,865,000 

1871 . . 1,911,608 

1872 . . 2,854,558 
















1874 . . 2,689,413 
187s . . 2,266,581 

1876 . . 2,093,236 

1877 . . 2,314,585 

1878 . . 2,577,361 

1879 . . 3,°7°-875 














1880 . . 4,295,414 






1881 . . 4,641,564 










1882 . . 5,178,122 






1883 . . 5,146,972 

1884 . . 4,589,613 

1885 . . 4,529,869 










1886 . . 5,600,000 
estimated 











The Relative Strength and Weakness of IsFations. 65 



VIII. 
COTTON CROPS OF THE UNITED STATES. 



gate to the people not only of Ireland, but of England, Scotland, and 
Wales as well, the functions of home-rule, of self-government, and the 
charge of their ovvn local affairs. 

Members of Parliament appear to have at length discovered that the 
lesser details of local affairs are entirely beyond the power even of a rep- 
resentative but single and 
centralized Parliament, al- 
though such Parliament 
may be nominally su- 
preme. One can more 
readily comprehend the 
present condition of Great 
Britain and Ireland by im- 
agining the deadlock which 
would arise in this coun- 
try if it were necessary to 
apply to Congress for an 
act to construct water or 
sewage works for the ser- 
vice of each town or city in 
Massachusetts or any other 
State, or to build a railroad 
in any part of the country. 

In the United States, 
on the other hand, we find 
thirty-eight interdependent 
States to which others may 
soon be added, in each of 
which local self-govern- 
ment in the strictest sense 
is absolutely assured by 
the support of the central 
sustaining power of the 
nation. We have neither 
the weakness of the cen- 





Bales 


865-66 . 


. 2,228,987 


S66-67 . 


. 2,059,271 


867-68 . 


. 2,498,898 


368- 69 . 


• 2,439'°39 


869-70 . 


• 3,154,946 


870-71 . 


• 4,352,317 


871-72 . 


■ 2,974.351 


872-73 . 


3.930,508 


873-74 ■ 


. 4,170,388 


874-75 • 


• 3,832,991 


875-76 . 


. 4,669.288 


S76-77 . 


■ 4,485,423 


877-78 . 


. 4,811,000 


S78-79 


■ 5,073,531 


S79-80 . 


■ 5,757,397 


880-81 . 


. 6,589,329 



5,435,' 



2-83 . . 6,992,234 



-86 . . 6,550,215 

93,389,031 
-1861 
nclusive, 58,441,906 



21 crops made by free labor. 
21 crops made by slave labor. 
34,947,125 21 excess by free labor. 

The average weight, per bale, has also steadily increased. 
' The value of 35,000,000 bales of cotton produced by free labor in excess of the product of slave labor 
cannot have been less than $2,000,000,000 or about the full valuation of all the slaves who were made 
free by the war. This gain is due not only to the freedom given to the blacks, but to the emancipation 
of the white men of the South from the indignity of enforced idleness. 

The cotton crops of the United States subsequent to the publication of this article have been : 
1886-87 . . . 6,513,623 bales 

1887-88 . . _ . 7,017,707 " 

1888-89 • estimated 7,100,000 " 

To the value of the cotton crop may now be added the utilization of the cotton seed and its conversion 
into oil, food for cattle, and other purposes. Under the old system of slave labor the cotton seed was 
nearly all wasted : yet such was its known theoretical value to those who had made a complete study 
of the plant, as to have justified the writer in stating in a treatise on " Cheap Cotton by Free Labor," 
printed in 1861, that if there were a variety of the cotton plant which could have been grown in the 
Northern States producing only seed but no lint, it wouljl long before have become one of the valuable 
crops of free labor. 

5 



66 



The IndtLstrial Progress of the Nation. 



IX. 
PROGRESS IN WEALTH. 

Computations of wealth, such as are given in the census, 
are not of much value. Progress in wealth can, perhaps, be 
measured as accurately by the amount of insurance against 
loss by fire as by any other standard. 

The following table, compiled by Mr. C. C. Hine, editor of 
\.\\e. Insurance Monitor ^oi New York, gives the amount of 
risks taken by all the fire insurance companies which are 
licensed to transact business in the State of New York. 

In the judgment of Mr. Hine, about ninety per cent, of all 
the insurance taken in the United States is covered by the 
companies which make an annual report of their whole busi- 
ness in the United States to the Insurance Commissioner of 
this State. 

The effect of the war may be traced by the apparent reduc- 
tion of risks during the period in which business intercourse 
with the Southern States was interrupted. 
Year. Risks taken. Proportion. 



1870 



1B72 
1873 



187s 
1876 
1877 



1,498,569,125 



tralized nation nor that of 
the separate petty states ; 
but under our system we 
have the united power of a 
body of English-speaking 
people outnumbering all 
the English-speaking peo- 
ple of Great Britain and 
her colonies combined. 

In the town-meeting of 
New England, and of 
some of the Western States 
which were settled by her 
children, and in somewhat 
less degree in the county 
divisions of other States, 
we find an absolute dem- 
ocracy guarding its own 
local affairs with a jeal- 
ousy of centralized power 
which is sometimes even 
too urgently expressed. 
Each little community is, 
perhaps, more self-govern- 
ing and self-sustaining un- 
der the protection, first of 
the State and next of the 
Nation, than any whichever 
before existed in any civil- 
ized state, or in any period 
of time since the Norsemen 
clashed their shields in the 
meetings of the freemen, 
from whom so much of our 
liberty has been derived. 

Insurance risks reported to the Commissioner of the State of New York subsequently : 

1886 . . . $11,349,685,459 1888 . ._ . 13,093,938,785 

1887 . . . 12,230,325,078 1889 . Estimated 13,800,000,000 
There are no absolute data for computing the risks which are not reported to the Commissioner 

of the State of New York. The Factory Mutual Companies of New England cover a little less 
than $500,000,000, and by comparison with the census of 1880 the local fire companies which do not 
transact any business in the State of New York cover about $700,000,000 more, making a total of poli- 
cies now in force of about $15,000,000,000. 

This is a large and perhaps incomprehensible sum, but as the population must now be over 63,- 
000,000, it gives an average per capita of only $238. 

The experience of insurance companies warrants an estimate that the amount of insurance car- 
ried corresponds to about two thirds the value of property that might be consumed. On this basis 
the average capital of the community which is subject to loss by fire amounts to about $360 per 
head. If foundations, railway tracks, and other forms of capital which cannot be burned amount 
to one third the amount subject to loss by fire, then the actual capital may be $480 to $500 per head ; 
this sum reached by a wholly different process of computation, very fairly sustaining the estimates 
of the census of 1880, which came to $870 per head, including land, and less than $500 aside from the 
valuation of land. It also sustains the estimates of economists and statisticians, that the capital of 
the richest community seldom or never e-xceeds the value of two or three years' production, which I 
have elsewhere computed at not over $200 per head in 1880. 




The Relative Strength and Weakness of Nations. 67 

What would have been our condition had the Potomac become the 
Rhine, dividing two nominally independent states or communities, or 
h*ad the country beyond the Mississippi remained under the dominion 
of a foreign nation ? 

We may answer this question by referring to the facts. The nine- 
teen independent states of Europe, whether empires, kingdoms, duke- 
doms, or republics, require a standing army of over four million men 
in the aggregate, constantly under arms, to guard the frontiers and to 
maintain the so-called balance of power. About ten million more men 
are held in reserve who have already wasted the best and most pro- 
ductive part of their lives in preparing for, or in active war. 

The thirty-eight interdependent States of this country require a 
standing army of only 25,000 men, serving mostly as a border police, 
and also forming a nucleus around which freemen may gather at a 
day's warning, to be formed into an army with which it would be use- 
less for any foreign or domestic disturbers of the peace to attempt to 
cope. 

To what do we owe this immunity from force ? Is it not mainly 
because we have almost learned the open secret that in all commerce, 
whether between states or with other nations, each man serves the 
other, and that the gain of each is the gain of all ? 

Was there any more potent influence by which the people were in- 
duced to surrender their carefully guarded separate existence under 
the confederate form of government which preceded the adoption of 
the Constitution, than the difficulties and dangers to the Union, which 
occurred during the Revolution itself, and also in the short period 
from 1783 to 1787, growing out of the separate attempts to control not 
only the trade with foreign countries, but of the several States each 
with the other, by separate laws and regulations ? 

Were not the prime causes of the war of the Revolution itself and 
the separation of the colonies of America and Great Britain strictly 
commercial in their character ? The resistance to the stamp tax was 
but the final pretext. The real grievances had existed for a long 
period, and they consisted in the attempt of England to prevent the 
manufacture of iron and steel in the colonies, and to repress textile 
manufactures, which were rapidly becoming established. To this end 
repressive laws were passed, commerce between the several colonies 
was restricted or forbidden, and the navigation acts, passed at the 
instance of the Long Parliament in a vain attempt to destroy the free 
commerce of the Dutch, were revived in an equally futile attempt to 
restrict the growing commerce of the colonies, especially with the 
West Indies and the Spanish Main. John Hancock had himself 
been one of the great smugglers of his day. It remained for the 
Congress of the United States to do what Great Britain failed to ac- 



68 The Industrial Progress of the Nation. 

complish. By means of the same navigation acts, modeled on those 
of Cromwell's time (known as the 12th of Charles II.), applied to our 
own people, we have substantially succeeded in driving our own flag 
from the ocean. 

Whatever may now be the difference of opinion among men of 
affairs in this country in regard to the conditions by which foreign 
commerce shall be conducted, there is but one common judgment as 
to the vastly greater commerce which exists among ourselves. No one 
now questions that the stability of this nation and its exemption from 
the necessity of a large permanent armament have been more fully 
assured by the single provision of our organic law which forbids any 
interference with commerce between the several States, than by any 
other law or custom which exists among us. Had it not been for this 
absolute freedom of domestic trade, we might have repeated the blun- 
ders of European states, and we might now be in almost as desperate 
a condition as many of them are in. 

It will be in no boastful spirit that some of the material results of a 
century of the constitutional history of this country will now be given 
and the balance struck with other states or nations. It is only since 
the passive war of slavery culminated in the active war by which it 
destroyed itself, that a citizen of the United States could face the 
English-speaking people of other lands without a blush of shame. It 
is only in the last twenty-one years, or since slavery finally surrendered 



The following Recapitulation is substituted for one which was given in.the original article ; it is 
brought down to a later date. 

Percentage of 
Gain in Population, Production, Wealth, and Savings, 1870 to 1885, and on Some Items to 1886. 



To 1885. Population 48 

1885. Production of grain 85 

1885. Consumption of cotton. . 86 

1885. Consumption of wool ... 88 

1885. Production of hay 100 

1885. Deposits in savings-banks 

of Massachusetts 102 

1885. Production of cotton .... 108 

1886. Deposits in savings-banks 

of Massachusetts 115 

1885. Production of iron 143 

1885. Insurance of property 

against loss by fire .... 160 

1885. Miles of railroad 168 

1886. Miles of railroad 192 

1886. Production of iron 200 



In considering these relative gains it will be observed that they represent a constant gain in the 
means of subsistence over population ; that with the exception of the increase in personal wealth, which 
is indicated by the increase in the amount of property insured against loss by fire, they represent the 
progress of the million in the means of common welfare rather than of the millionaire in personal 
■wealth, and that they give testimony to the beneficent law of progress _/"ro;« poverty. 



The Relative Strength and Weakness of Nations. 69 



XI. 
LIFE INSURANCE. 
Compiled by Mr. C. C. Hine, Editor of the " Insurance 
Monitor," of New York. 
There are now twenty-nine solvent and prosperous life in- 
surance companies in the United States, of which nineteen 
were in existence in 1865. Between these two dates others 
have become insolvent. 

The data below show the progress of the existing companies 
by a comparison of their risks in force in each year. 



at Richmond, that local self-government has had any existence over 
the southern half of our country. The Southerti States have gained in 
their defeat the very end for ivhich they rebelled j and they have now 
discovered for themselves that local self-govet-nment can only exist in any 
true sense ivhere the equal 
rights ofallfjieji are respect- 
ed, a7id when sustained by 
the power of a great nation. 
There has been not 
only such a revolution of 
institutions but of ideas in 
the Southern States, that 
it would take a larger 
Northern army to re-im- 
pose the burden of slavery 
upon them than it did to 
remove it. The growing 
prosperity born of liberty 
is now so fully assured 
that the very " rebel brig- 
adiers " have become most 
loyal citizens and safe leg- 
islators ; yet less than a 
generation has passed 
since all this was accom- 
plished. All that we can 
therefore claim is that we 
have just begun to com- 
prehend the problem of 
common welfare, while we 
admit that we have yet 
much to learn. 

It will be apparent, from the consideration of the quality and kind of products of which the increase 
has been so very great during the last twenty-five years, that the gain has been mainly in the products 
which are of common consumption by the great mass of the people — food, metals, and fibres. This 
great additional supply of materials of common consumption, or which are used in the processes of do- 
mestic industry, either directly or when exchanged for foreign imports for similar use, must have been 
mainly consumed by the great mass of the people, because the small number of the rich, and the 
somewhat larger number of the well-off who cannot be called rich, were already able to provide them- 
selves with all that they could possibly require of such articles as wheat, corn, cotton, iron, wool, 
and the like. Hence it follows of necessity that the additional product must have been consumed in 
such a way as to add greatly to the material welfare of the great masses of the people. Under such 
conditions one would rightly expect the result to be a prolongation of life ; a more ample supply of 
food and clothing, better shelter, easier methods of distribution, coupled with great progress in sani- 
tary science would of necessity tend to an increase in the duration of life. This expectation has been 
realized. [Through the courtesy of Mr. William P. Stewart, one of the most experienced actuaries in 
the country, I am permitted to print a table (page 70) which he has lately prepared, showing the actual 
and possible curves of life, giving scientific proof of progressive increase in the duration of human life.] 
Had it not been for this increase in the duration of life, it might have happened that life-insurance 
companies would have suffered from the reduction in the rate of interest which they are now obliged 
to accept on their investments in consequence of the rapid accumulation of capital ; but it will be very 
plain that if, coincidently with the reduction in the rate of income upon investments, the duration of 
life insured is being prolonged, then policies issued on existing tables might be even safer than they 
were under former conditions, while it may soon happen that the rates of premium which are now estab- 
lished may be computed on new tables computed at lowerrates. 



'865. 


. 507,285,914 


1866. 


■ 73I^373.332 


1867. 


• 9471676,897 


1868. 


.1,217,729,344 


1869. 


•1,353.585-723 


1870. 


.1,441,334,237 


I87I. 


.1,451,410.487 


.872. 


•1,542,0x5,515 


1873. 


.1,602,394,973 


1874- 


.1,609,841,449 


1875- 


.1,603,464,680 


1876. 


•1,573,972,605 


1877. 


.1,496,596,847 


1878. 


.1,429,506,323 


1879. 


.1,422,817,588 


1880. 


.1,464,250,018 


I88I. 


.1,539,846,581 


1882. . 


.1,637,582,773 


1883. . 


•I, 763,730,°! 5 


1884. . 


.1.870,745,521 


1885. . 


.2,023,517,488 



70 



The Industrial Progress of the Nation. 



W^ 


< 


fo 




1— H 


HH 


J 


> 




p4 




p 


Uh 


w 


o 


ft! 




cq 


^ 


S 


•^ 


;= 


CO 


a 


> 




C^ 


>< 


:=) 


c 


C ) 






<; J" 


- 


H r^ 




fi < 


w 


S n 


J 


Q a 


m 




(— 1 


- h-i 


CO 
CO 


H O 


O 


w 


CU 


<: 




H 


Q 




^ 




< 






en 


J 





D 
H 
U 



i| 


















t^' 


y 






o 

H 

<1 

l-l 
w 


1 s -s 1 ^ 
5 1 ^ >5 "; 

oj a jj o „ 

|i 1 & s 

•5 ° 1 Ji 1 . 
>. o 3 o S 






y^ 




/ 








,^ 


p^ 


y 


^1 






p55^ 




A. ^ 


y 




00 




,0k 


i-^^ 

&/ 


V 


^ 




00 




^7 






A 




/■^ - - 


> 


^/ 


// 


15 


1 


J / 






y 

Oi/ 




A 


^/ 


/ 


/ 

2 




1, 


' 




ii 


? 




7 














^1 

to/ 


/ 










o 

so 


4 




N 


t/ 


7 








/ 1 


Ul\Ul " 

T 








i 


f ^ 


f 








^ 




s 






•77 


v/ 






/ 








-*• 


o 


/ 




^ 




< 

•^ 


/ 












/ 


' / 








> 
K 

3 


Ul 

12 






/ 




-1- '^ 




U 

h 

9) 


iZ 


O 

to 




'// 


J"' 






u 


u 
u 






0<^ 






-, u ho rt «J " r ^ u u -r; >!; 
J313 n Bin s CiSiJS o 




o 

i 

o 


z 
o 


o 


k 


ii^ 
















o 

Q. 


i. 



The Relative Streiigth and Weakness of Nations. 7 1 

Short as has been the period since we first began to reap the harvest 
of true liberty, yet cannot the words 

DISARM OR STARVE 

be read between the lines or underneath the figures of the balance-sheet 
of nations which is now submitted ? 

When government by force of arms meets the competition of a free peo- 
ple governed by their own consent, in the great commerce of the world, 
what chance of success can there be on the part of states into the cost of 
whose product is charged the blood-tax of huge standing armies and of 
war-debts, or upon whom a war-tax presses which takes from a product 
that would barely suffice for a meagre subsistence so much that many 
are already starving or only eking out a feeble life on pauper wages ? ' 

I have endeavored to put into the form of what may be called a visible 
speech the results of the comparisons which I have made in regard to 
the relative weakness and strength of this and of other nations," from the 
standpoint simply of a man of affairs engaged in the daily work of life. 

I have taken the year 1865 as the starting-point. It is sometimes held, 
and perhaps with truth, that in the very struggles which ensued between 
the dates 1861 and 1865, in the effort to eliminate from our organic 
law the elements of injustice and wrong by which it had been perverted, 
that the imagination of the people of both sections was first aroused 
and their knowledge of each other was greatly extended. A knowledge 
of the vast extent of the land and its resources also became common to 
all. Thus great enterprises became possible which might otherwise 
have been deferred for half a century or more. The great railroad 
constructor, the manufacturer, and the merchant of to-day engage in 
affairs as an ordinary matter of business, which to their predecessors, 
or even to themselves in their early manhood, would have been deemed 
impossible of accomplishment in a whole lifetime. Before the war, one 
line of railway to the Pacific was the vision of a half-cracked enthusiast ; 

' When the people of this country shall learn the simple lesson that in all commerce 
tetween men or nations, both parties gain, or else the commerce ceases ; and that high 
wages in money or what money will buy are the necessary correlative or consequence 
•of low cost of production, then may we expect to see a great commercial union or sys- 
tem of free trade among the English-speaking people of the world, against which no 
army-ridden nation can hope to compete. Then the vision of Richard Cobden, the 
calico printer, and of John Bright, the cotton-spinner, will become living truths, and 
the law of mutual service will overcome the disorder of mutual strife, while the weak- 
ness of great armies will compel armed states and nations to disband them. Until this 
simple lesson is learned, the people of the United States will fail in their claim to be 
great among nations, however great in their own domain, and their influence for right 
will be impaired by their intellectual and political mediocrity. 

^ The substance of this article was first submitted in the form of an address to the Amer- 
ican Association for the Advancement of Science, at the meeting of 1886, held in Buffalo. 



72 



The Industrial Progress of the Nation. 



to-day the opening of a. fifth or sixth line would call only for a descrip- 
tive paragraph in a newspaper. 

^^^- In the table on page 

Wages, per Day, of Carpenters, Painters, Machinists, • . r 

Blacksmiths, Cabinet-makers, and Others in Similar ^4 the proportions of ar- 

OCCUPATIONS. 

Comparisons of wages at different dates and in different places able, paStUrC, and mOUn- 
are apt to be fallacious, because of the difference in conditions ; . . , ^ j ^ 

therefore certain specific leading establishments have been taken tam Or timber land Of the 
as a standard, where the work has been continuous. The statis- . , _, . , 

tics were obtained by the Massachusetts Bureau of Labor United btateS" IS repeated 
Statistics, in part from the books of the employers and in part 
from the accounts of workmen. 

Table I.— Workmen 0/ average capacity, per day. 



1872 



i860 
1865 
1870 
1872 



Gold . 
Paper 



Gold 



2.285 
1.824 

1-375 
1. 714 
2.18 

2.04 



from the January Century 
as the preface to the subse- 
quent tables. Much of 
the pasture land may yet 
be converted into most 
productive arable land by 
irrigation ; while the 
mountain and timber land 
is permeated by a great 
number of fertile valleys. 
Subsections I. to VI.^ 
inclusive, show the abso- 
lute use of land for our 
present grain, vegetable, 
and cotton crops, upon 
which we now produce 
grain enough for 80,000,- 

Relative Purchasing Power of One Dollar of Lawful ooo, and COtton enough 

Money at Different Dates, as Compiled by Mr. Wm. M. ' '' 

'Grosvenor by the Tabulation of the Prices of Two for 2^0,000,000 people OT 
Hundred Articles, Comprising Nearly Every Commodity 
IN Common Use, One Dollar of Gold being taken as a morC. 
Standard in i860, Represented by a Purchasing Power 
of 100. 
One dollar, lawful money, 

i860 100 



Table II. — Worknien of superior skill., per day. 
2-37 
2.7s 
2.25 



Gold 
Paper 



Gold 



1.87 
2.12 
3.00 
3.00 



May I, 1865 
1870 
1872 



Average, year iS 



76 



63 



Sub-sections VII., VIII.,. 
and IX., if they were cul- 
tivated by well-known, 
methods of intensive 
farming, would suffice for 
a larger product of beef, 
wool, and mutton, and" of 
milk, butter, and cheese,, 
than is now enjoyed by 
the present population,, 
even at a more wasteful 
and lavish mode of subsist- 
ence than is nowpractised. 



Wages of mechanics in Massachusetts having been twenty-five per cent, more in 1885 than in i860, 
while the purchasing power of money was twenty-six per cent, greater, the workman could either raise- 
his standard of living, or on the same standard could save one third of his wages. 

In a subsequent chapter reprinted under the title of " Low Prices, High Wages, Small Profits — 
What Makes Them ? " — comparisons are given class by class, compiled from more adequate data, more- 
than sustaining the combined effect of the lower prices and of wages both higher in rate and in pur~ 
chasing power upon the welfare of the great mass of the people. 



The Relative Strengih and Weakness of Nations. 75 



XIII. 

Deposits in the Savings-Banks of Massachusetts. 



In tables subsequent to the first I have given the statistics of the 
increase of cotton, of the railway mileage, and of the products which 
lie at the foundation of all material welfare. 

The tables printed in connection with this article give conclusive 
testimony to the enormous growth in wealth of the United States since 
the end or even during the civil war. It is admitted, however, that 
growth in wealth may not be synonymous with growth in general wel- 
fare. Absolute proof of the latter, statistical especially, is a matter of 
great difficulty to the economist and the statistician. For the present 
I can only refer to the following table No. XIII., in which the increase 
of deposits in the savings-banks of Massachusetts is given, and also the 
increase in the purchasing power of a dollar, as shown in table XII. 
This subject will be treated more at length in a future article. 

In the judgment of the Commissioner of Savings-Banks, and of many 
others who are competent to form an opinion, at least three fourths of 
the present deposits in these banks belong to those who are strictly of 
the working classes, 
in the limited sense in 
which those whose 
daily work is neces- 
sary to their daily 
bread make use of 
that term. This sys- 
tem of savings-banks, 
managed by unpaid 
trustees without ex- 
pectation of personal 1874. .217,452,120 
profit to any stock- 1875. .237,848,963 
holder or individual, 
or to any one except 
the depositors and the 
relatively small exec- 
utive force required, 
is practically limited 
to New England and 
the Middle States. 
The total sum on de- 
posit in all those 
States is now com- 
puted at $1,100,000,- 
000, at an average of 
$356 to each deposi* 
tor. 

If the system were 



1867. 



1870. 



59.936,482 
67,732,264 
80,431,583 
94,838,336 
112,119,016 

135,745,097 
1871. .163,704,077 
1872. .184,797,313 
1S73. .202,195,343 



1876. .243,342,642 

1877. .244,596,614 

1878. .209 860,631 

1879. -206,378,709 

1880. .218,047,922 

1881. .230,444,479 

1882. .241,311,362 
1883. .252,607,593 

1884. .262,720,146 

1885. .274,998,412 



Population, 1865 1,267.329 

Number of deposit accounts 291,488 

Average deposit, each account $205.62 

Average deposit per head of population $47-29 

Population, 1885 1,941,465 

Number of deposit accounts 848,787 

Average deposit, each account $233.99 

Average deposit per head of population $141.64 

If the savings-bank deposit of the whole population of the United 

States were now equal per capita to that of Massachusetts, the sum of 

such deposits would be over $8,400,000,000. 



74 The Industrial Progress of the Nation. 

extended throughout the country, and the deposit per capita of the peo- 
ple of the United States were equal to that of Massachusetts, the total 
sum would amount to somewhat over $8,400,000,000. 

Another fact may be cited which fairly sustains the general state- 
ment that those who do the actual work of production are now secur- 
ing to their own use a larger share than ever before of the joint product 
of labor and capital. 

The earning power of $100 in gold coin invested in United States 
bonds of the best class was, at the highest point of paper-money infla- 
tion in 1864, i6y®oV per cent, per year. At the present time the earn- 
ing power of $100 in gold goin invested in 4-|- per cent. United States 
bonds is only 2-^-^-^ per cent, per year.' 

While the power of capital to secure income merely as capital has 
thus been diminished, the wages of by far the larger part of all the me- 
chanics, operatives, domestic servants, and the like, are now as high or 
higher in gold coin than they were in paper money at the highest point 
which wages or earnings reached in the paper-money inflation period 
of 1864 to 1867. See table XII. 

By the use of this extremely valuable table of the prices of 200 
commodities, constituting almost every thing necessary to subsistence, 
compiled by Mr. Wm. M. Grosvenor, of New York, it appears that if the 
purchasing power of one dollar in gold coin, on May i, i860, be' taken as 
the standard, or one hundred cents' worth, the corresponding purchasing 
power of one dollar of lawful money on May i, 1865, at a period of great 
paper inflation, was ^d^i^is cents' worth of the same commodities. On 
May 1, 1872, in the year preceding the financial collapse of 1873, the pur- 
chasing power of a paper dollar was less than seventy-five cents' worth. 

At the present time, and at present prices, the gold dollar will buy 
twenty-six per cent, more than in i860. That is to say, wages are now 
as high or higher than they were from 1865 to 1872 in paper, and much 
higher than they were in i860 in gold : they are now paid in gold coin 
or its equivalent. This gold coin will buy the commodities which are 
necessary to subsistence, in the ratio of 126 units now relatively to 75 
units in 1872, and to 57I- units in 1865, or to 100 units in i860. Wages 
have increased absolutely and relatively, while profits have decreased 
relatively in much greater proportion. 

It is made apparent that the increased abundance derived from our 
fields, forests, factories, and mines must have been mostly consumed 
by those who performed the actual work, or who belonged to the 

' The fact that the city of New York has, during the present year 1889, negotiated 
a loan for park purposes, on untaxable bonds, payable in forty but redeemable after 
twenty years, at two and one half per cent, per annum, the loan having been placed at a 
fraction above par, may go far to provp that capital is now accumulating in this 
country even faster than the general intelligence of the people, which is necessary to its 
productive use. 



The Relative Strength and Weakness of Natio7is. 75 

working classes in the sense in which those who work for wages for 
small salaries or on small farms choose to construe that term, because 
they constitute so large a proportion — substantially about ninety per cent. 
— of the whole number of persons by whom such products are consumed. 

The greatest increased production has been in substances which are 
mainly used by the masses of the people. Articles of food necessary 
to life have increased more than the luxuries consumed by the rich. 
Hence no other evidence is needed to prove that the working men and 
women, in the strictest meaning of those words, are, decade by decade, 
securing to their own use and enjoyment an increasing share of a 
steadily increasing product. 

The labor question, as it is called, therefore consists in determining 
the conditions of the distribution of that greater proportion which is 
consumed by those who do the physical work of production. Invention 
creates opportunity for skill, and hence skilled workmen who do not 
bind themselves to work at the same rates of wages as those who are 
less skilful and less industrious, are steadily rising, so that there may 
now be greater disparity between the conditions of skilled and common 
laborers than ever before. 

While the great products of the United States have thus increased, 
in the same period the burden of the public debt of the nation has 
been steadily reduced. The books of the Treasury never showed the 
maximum debt ; but in his last report as Secretary of the Treasury, 
the Honorable Hugh McCulloch added the debt which was due August 
I, 1865, but which had not been audited and entered, to the debt then 
recorded, showing that the maximum debt was but a fraction under 
^3,000,000,000. 

Our ability to reestablish the specie standard of value has rested 
mainly upon our power to produce a great excess of food, cotton, oil 
and other commodities, which we have been able to export in exchange 
for our foreign purchases, while retaining our production of gold and 
adding thereto in the full measure necessary for our purpose. 

A review of the traffic of the last five years will show the relative 
importance of our foreign commerce. 

In the five fiscal years ending June 30, 1881 to 1885, inclusive, 
the exports of domestic products, consisting in much the greater 
proportion of the products of agriculture, have been valued at the 
port of export at $3,873,057,515, an average of $774,611,503 each 
year. 

At the average of $200 worth of product per capita of the popu- 
lation, or at $600 worth of product to each person occupied in gainful 
work, mental, mechanical, manufacturing, or distributive, this export 
represents the result of the work of 1,129,019 farmers, mechanics, 
factory operatives, railway employees, merchants, and others, in each 



76 The Industrial Progress of the Nation. 

year. So large a part of these exports, however, consisted of cotton 
and other farm products, that the average of $600 product per man is 
too high ; $500 per hand would be a large estimate, at which rate our 
average export for five years would represent the product of 1,549,223 
persons, and even that estimate is probably too small. Except for 
this foreign demand for the excess of our food, of our cotton, of our 
oil, of our dairy products, and the like, they might have rotted upon 
the field or remained unused because they were the excess over our 
own lavish and wasteful consumption. 

In exchange for these products of our own fields, mines, and fac- 
tories, we have imported $3,314,818,061 worth of the necessaries, 
comforts, and luxuries of life ; the balance of the traffic, including the 
profits of our export trade, having come back to us almost wholly in 
gold coin or bullion. 

Possessing, as we do, an almost paramount control of the most 
available supply of food and cotton, which Europe must have or starve, 
we hold a demand check upon every bank in Europe for the coin or 
bullion on which we maintain the specie standard of value, which is 
so essential to prosperity. 

The commodities imported in the five fiscal years ending June 30, 
1881 to 1885, inclusive, have been classified in the National Bureau of 
Statistics as follows : 

A. Articles of food and live animals $1,079,869,829.00 

B. Articles in a crude condition which enter into the processes of 

domestic industry 720,826,681.00- 

C. Articles wholly or partially manufactured, for use as materials in 

manufacturing and mechanic arts 390, 102,678.00 

$2,190,799,188.00 

D. Articles manufactured ready for consumption $718,300,081.00 

E. Articles of voluntary use, luxuries, etc 405,718,792.00 

$1,124,018,873.00 
Total 3,314,818,061.0a 

Free of duty $1,024,385,175.00 

Subject to duty 2,290,432,886.00 

Duties paid thereon 986,002,925.00 

Export per capita -. $17-52 

Imports " " ■. 15-04 

Except for this export our excess of grain and cotton could have 
little or no present use, and therefore no value ; what we import we 
could not pay for except with grain, cotton, oil, etc. The whole value 
of our imports, therefore, becomes the secondary product of our own 
labor, and the sum of such imports is so much added to the fund from 
which wages, profits, and taxes are alike derived. 

In the use of the imports which -enter into the processes of our 



The Relative Strength and Weakness of Nations. jj 

domestic industry and are thereby converted into domestic manu- 
factures, another great body of industrious working men and women 
have been occupied. 

Although the domestic commerce of this and of every other civiHzed 
nation is vastly greater in volume and value than its foreign com- 
merce, yet the latter serves as a balance-wheel to the whole. The 
interdependence of nations thus asserts itself : the wider the com- 
merce or mutual service, the greater the result of the labor applied, 
the lower the proportionate cost, and the higher the rates both of 
profits and wages, which are alike derived from the final sale of all 
products, whether the money distributed comes from the sale of the 
primary products of strictly domestic industry or from the secondary 
products imported in exchange for the excess of the first. 

Thus far it has been easy to prove the enormous growth of the 
productive power and wealth in this country. We have gained in 
" number of people, in supplies and resources, in the necessaries and 
conveniences of life " ; have we made equal progress " in good laws, 
good public officers, in virtuous citizens, in strength and concord, 
in wisdom, in justice, in wise counsels, and manly force " ? If we have 
not, then 

" Of what avail the plough and sail, 
Or land or life, if freedom fail?" 

May not this vast gain in the conditions of material welfare in 
the United States be mainly attributed to the following elements in 
our national life ? 

First. The free purchase and sale of land, and the stability which 
ensues from the fact that so large and constantly increasing proportion 
of the people actually possess land. 

Second. Absolute freedom of exchange among the several States. 

Third. The system of common schools which is now extending 
throughout the land. 

FourtJi. The protection which the possession of the right to vote 
gives to the humblest citizen, both white and black. 

Fifth. Local self-government in the strictest sense, in the manage- 
ment of local affairs. 

Sixth. General laws in most of the States enabling cities and towns 
to provide water and sewage without special acts of legislation, and also 
enabling corporations to be formed for the construction of railways, 
so that no monopoly of the mechanism of exchange can exist. 

Seventh. The habit of combination and organization engendered 
by long practice, to the end that if any thousand persons, with perhaps 
the present exception of the lately enfranchised blacks, were suddenly 
removed to some far distant place, away from their fellow-men, the 



7^ 



The Industrial Progress of the Nation. 



men of adult age would immediately organize an open meeting, choose 
a moderator, supervisor, or mayor, elect a board of selectmen, of 

THE PRICE OF LIBERTY.— THE PUBLIC DEBT OF THE UNITED STATES. 

Per Cap. Reduction debt per capita. 

July I $59,964,402 1. 91 



1863 



1873 
1874 

187s 
1876 
1877 
1878 
1879 



87,718,660 2.74 



505,312,752 15.45 

" 1,111.350,737 33-31 

" 1,709,452,277 50.21 

" 2,674,815,856 76.98 

Aug. 31 .... 2,997,386,203 84.00 

July I 2,636,036,163 74.32 

" 2,508,151,211 69.26 

" 2,480,853,413 67.10 

" 2,432,771,873 64.43 

" 2,331,169,956 60.46 

" 2,246,994,068 56.81 



2,149,780,530 
2,105,462,060 
2,104,149,153 
, 2,090,041,170 
, 2,060,925,340 
2,019,275,431 
1,999,382,280 
, 1,996,414,905 
, 1,919,326,747 
, 1,819,650,154 
• 1,675,023,474 
, 1,538,781,825 



52.96 
50.52 
49.17 

47-56 
45-66 
43-56 
42.01 
40.86 
38.27 
35-36 

31-72 
28.41 



1,375,352,443 24.09 



Oct. I 1,367,549,567 23.00 



1,274,728,153 21.60 



At the date when 
^^^ this treatise is being 
proposed for repub- 
lication the net debt 
— > of the United States 
of all kinds, includ- 
ing the bonds ad- 
■■■ vanced to the Pacific 
Railroad, is less 
_ than $1,100,000,000. 

On the ist July» 
1889, a further re- 
duction will have 
been made, and, 
omitting the bonds 
advanced to the Pacific 
Railroad, the net debt will 
be a little les.s than $1 ,000,- 
000,000, and the population 
will then be 63,000,000, 
giving a ratio of debt to 
population of less than 
§16 per head — a reduction 
of seventy-five per cent, 
since Aug. i, 1865. 

It now seems probable 
that as the people have 
not yet decided in what 
manner the national rev- 



'^ Debt audited and en- 
tered on the 31st of 
August, 1865, being 
the highest record . 

Added for debt due but 
not then audited 

Total .... 



$2,756,431,571 

240,954,632 

$2,997,386,203 



* According to the old form, corresponding to the form in use 1865-85 inclusive, which does not 
include the bonds advanced to the Pacific Railroad Company to be paid by thein. The first statement 
for October i, 1886, includes these bonds and excludes the value of subsidiary silver coin from assets. 



The Relative Strength and Weakness of Nations. 79 

assessors of taxes, and a school committee, appoint one or two con- 
stables, and then, adopting the principle of the English common law, 
would at once undertake their customary gainful occupations. 

These factors in the life of a free people are not named in the 
order of their relative importance, but are given in a list, each relative 
to the other, and, as a whole, composing the main elements of our 
social organism. 

There may be a fallacy in the old democratic dogma that '' the 
government is best which governs least," but there is no fallacy when 
it is put in another form : That country will prosper most which 
requires least from its government, and in which the people, after 
having chosen their officers, straightway proceed to govern themselves 
according to their common habit. 

In the conclusion of this branch of the study of the facts and figures 
of this country, may it not be held that the alternate periods of 
activity and depression which have affected the industries of this 
country since the end of the civil war, have been mere fluctuations or 
ebbs and flows in the great rising tide of material progress, ending in 
an adjustment to ever new and better conditions of life ? Is it not true 
that while the rich may have become relatively no poorer, the poor 
have been steadily growing richer, not so much in the accumulation of 
personal wealth as in the power of commanding the service of capital 
in ever-increasing measure at a less proportionate charge ? Can it be 
denied that labor as distinguished from capital has been and is secu- 
ring to its own use an increasing share of an increasing product, or its 
equivalent in money ? 

enue is to be reduced, and since the Congress, which will hold its first session in 1889, will probably prove 
to be wholly incapable of dealing with the question, the excess of revenue above authorized expendi- 
ture may go on at the rate of about two dollars per capita for about four years more, in which period, 
under such conditions, the debt will be reduced to a fraction over $500,000,000, and may be wholly paid 
in one generation from the date when it reached the maximum. 

The cost, measured in money, of removing the compromise with slavery from the Constitution of 
the United States, was as follows : 

The national revenue collected from April i, 1861, to June 30, 1868 — four years of war and three 
of reconstruction under military rule — was : 

From taxation and miscellaneous receipts $2,213,349,486 

From loans which had not been paid June 30, 1868 2,485,000000 

Total $4,698,349,486 

The peace expenditure would not have been over ...... 698,349,486 

Cost of the war .......... $4,000,000,000 

To the computed cost of the war — $4,000,000,000 — must be added by estimate the war expenditures 
of the Northern States and the value of the time, materials, and destruction of property in the South- 
ern States, together probably amounting to a sum equal to that spent by the National Government. 

The price of Liberty in money has therefore been 88,000.000,000. 

This comes to $1,135,000,000 per year for a little over seven years. The productive capacity of an 
average man is now about $600 worth per year. If it was then $500 worth, this sum represents the 
work of 2,270,000 men for seven years ; at $400 each, 2,837,500 men. 

The average population during this period was 35,000,000. If we assume one in five an adult man 
capable of bearing arms, there were 7,000,000, of whom one third paid the price of liberty in work for 
seven years, or in life. 

In an address given in Georgia a few years since, the writer ventured to predict that a time would 
corne when the children of Confederate soldiers would erect a monument to John Brown in commemo- 
ration of the liberty which he brought to the white men as well as to the black men of the South. Har 
it not come ? 



THE RELATIVE STRENGTH AND WEAKNESS OF 

NATIONS.' 

TWO STUDIES IN THE APPLICATION OF STATISTICS TO SOCIAL 

SCIENCE. 



II. WEAKNESS. 



H 



AVING analyzed the strength of Democracy in America we 
may now turn our attention to the other side, and consider 
the sources of the weakness of nations which are governed 



by dynasties. 

NATIONAL DEBTS— PER CAPITA. 

United States, National ^ . . $23 



United States, including 

State debts 2 27 



Germany, including King- 
doms and Duchies ^ . . 39 



Belgium ^ 

Italy 

Holland 115 

France ^ 124 

Great Britain 127 



^ July, 1889. Less than $16. 

2 July, 1889. Less than $20. 

It may be claimed that the debts of the several States 
constituting the United States should be added to the 
national debt. 

In 1880 the total amount of such debts was $226,597,594, 
since which date they have been diminished by large pay- 
ments in many States. The present debt of all the States 
is not in excess of $4.00 per capita of the whole population. 

The data for computing department, county, city, town, 
and communal debts are not within the reach of the 
writer ; but as these debts have been mostly incurred for 
public improvements, both in Europe and in this country, 
they do not come into the same category — debts of nations 
mainly incurred in war or in preparation for war. 

3 It should be stated that a considerable part of the 
•debt of Germany and Belgium and a small part of that of 
France, was incurred in the construction of railroads, but 
most of these railroads have been constructed for military 
purposes. 

' Reprinted with additions from The Century 



In Professor J. R. See- 
lye's recent book upon the 
expansion of Engand, he has 
traced nearly all the Europe- 
an wars of recent times to the 
struggle of nations for do- 
minion over other continents 
or parts of continents, in or- 
der to establish colonies and 
to control commerce there- 
with ; commerce itself hav- 
ing been regarded by almost 
all nations, and being now 
regarded by the greater num- 
ber, as a quasi war in which 
what one nation gains an- 
other must lose. 

This fallacy has led to 
very many of the great actual 
wars of the last century and 
a half, and the vast national 
debts of Europe have been 
incurred in this futile and 
foolish attempt to set up as 
a rule among nations : 

' ' Let him take who has the power, 
And let him keep who can." 

Magazine for February, 1887. 



The Relative Strength and Weakness of Nations. 8 1 

The business man who fully comprehends the function of the mer- 
chant and of the manufacturer, and the place which commerce holds 
in the beneficent progress of the world, may well covet the genius of 
Southey in order that he might add new verses to the " Devil's Walk " 
as he passes in review the great wars which have been fought to gain 
the control of commerce which could have been had for the asking, 
and which would then have yielded a vastly greater benefit to both 
parties than either could gain by attempting to get an advantage over 
the other. 

What more fruitful subject for the satirist than the bluster of the 
party politician at the present time, whose zeal is apparently in inverse 
proportion to his sincerity, in regard to the respective claims of this 
country and of Canada over the right to fish within a certain distance 
from the coast, when it would benefit both countries to put the regula- 
tion of all the fisheries under a joint control, so that both might be 
far better served with fish than either can now be ? ' 

What greater economic blunder has ever been committed than the 
support of slavery in this country for nearly a century of its history ? 
It was the most costly and least productive system of labor, brutalizing 
to the black man and debasing to the white man ; yet it was justified 

' Since this article was written, the fishery treaty negotiated by the late adminis- 
tration of President Cleveland, under the direction of the Secretary of State, Thomas 
F. Bayard, has failed of ratification in a Senate controlled by the opposition party. A 
more discreditable debate may never have occurred in the history of this country. In 
it the true point at issue was obscured by a mass of historic rubbish and misrepresenta- 
tion, especially on the part of New England. If salt cod and smoked herring were not 
taxed in the sum of $350,000 to $400,000 when imported from Canada, there would be 
no cause of dispute on the so-called fishery question. This tax is imposed upon a 
necessary article of food at the instance of the owners of fishing vessels, on the pre- 
tence that American seamen are trained for the navy in sailing these vessels — the fact 
being that at least three fourths of those who man the fishermen are foreigners, mostly 
natives of the maritime provinces of Canada. When the record of history is made in 
regard to this matter, it may be written that a cause of quarrel with Canada was main- 
tained for many years in order to collect a tax on a necessary article of food, which 
cost more for the administration of the customs service, the naval protection of the 
fishermen, and in the waste of time in the discussion in Congress, than the whole rev- 
enue derived from the tax. This tax was supported by the votes of those who were 
induced to pervert a public trust to purposes of private gain through false representa- 
tions made to legislators whose integrity can only be justified at the cost of their intel- 
lectual capacity to comprehend the true limits of public taxation. A tax which could 
not be justified for purposes of revenue, and which failed even in its ostensible object of 
giving more employment to American seamen in the fishing vessels, could therefore only 
have been maintained by a great and powerful nation out of petty jealousy and pusil- 
lanimous fear lest the progress of our poorer neighbors, in their attempt to serve us 
while gaining a living in an arduous and dangerous calling, should harm us in some 
way which no Senator proved to be capable of defining in the whole progress of the 
debate on the treaty. 
6 



8 2 The Indiistrial Progress of the Nation. 

by men of such intelligence and force that had it not been for the 
narrowing influence and the bitter apparent necessity imposed upon 
them to sustain a crime against humanity, they might have left a repu- 
tation as statesmen. 

What more ludicrous commentary upon the intellectual mediocrity 
of legislators than the demand lately presented in Congress by the 
representatives of one of the New England States for a heavier duty 
upon sugar when imported in bags rather than in boxes, in order that 
the Cuban planters might be compelled to buy the decreasing timber 
supply of the forests of Maine in the form of sugar-boxes, and charge 
it back to all consumers of sugar in this country as a part of the cost 
of imported sugar. 

Could there be a more complete reductio ad absurdum than the con- 
clusion to which the late Henry C. Carey was led by his lack of true 
insight in respect to the functions of commerce, namely, " that the 
material prosperity of this country would be more fully promoted by a 
ten-years' war with Great Britain than it could be in any other way " ? 
(I quote this from memory ; the statement was made in a conversa- 
tion to which I listened.) 

Yet out of this very jealousy of nations we gained almost without 
cost one of our most important possessions. 

One of the most singular of the incidents of one of these great 
European contests was the sale of the Louisiana territory to this coun- 
try by the First Napoleon, who, being unable to keep it, chose that 
England should not possess it. In a few short weeks this territory 
might have come under the dominion of England. One's imagination 
can hardly grasp the changed conditions of the world as they would 
have been had Great Britain succeeded in getting and keeping the con- 
trol of all that vast territory west of the Mississippi River which was. 
comprised in this purchase, thus confining the United States substan- 
tially to what lies east of this mighty river. 

It is a singular fact that there appears to be no historical school 
atlas in use in this country in which the several additions to the terri- 
tory of the United States are pictured and described ; hence very few 
persons realize the vast importance and extent of the Louisiana pur- 
chase, or know the true conditions of the great contest with the slave 
power over the extension of slavery into what was known in 1830 as 
the Territory of Missouri, which comprised a vast area outside the 
limits of the present State of Missouri. 

While modern European wars have thus become a struggle for the 
control of commerce, or for the control of vast areas of territory in the 
attempt to secure its commercet o single states, war itself has also been 
mainly sustained by what may be called commercial methods — that is 
to say, the rulers of nations have made use of bankers, through whom 



The Relative Strength and Weakness of Nations. 83 



they have pledged the national credit in order to support dynasties or 
to secure power to them. Even success in war has in later years de- 
pended as much upon the commissariat, or upon the business depart- 
ment of war, as upon the actual battles, or even more. 

This possibility of mortgaging the future by incurring a national 
debt has finally become the chief cause of the weakness of nations. 
The same century that has witnessed the increase of European national 
debts from a little over $2,600,000,000 to more than $22,000,000,000 
has also seen Spain, Portugal, Austria, and Greece become bankrupt, 
while Russia is without credit. The attempt to enforce the payment 
of the bonded debt of Egypt by the force of armies at the instance of 
foreign creditors may be held to be a disgrace to the nations that have 
engaged in the undertaking. The debt was incurred without the con- 
sent of the people, and even the interest cannot now be met without 
taking so large a share of the meagre product of the fellaheen as almost 
to reduce them to starvation. 

Before the century ends we may even witness a general repudiation 
of these national mortgag- 
es, which the dynasties of Relative burden of national taxation 
the past have imposed 
upon the people of the 
present without their con- 
sent, and in almost all 
cases to their injury rather 
than to their benefit. 

In order that the rela- 
tive weakness of Europe 
caused by the burden of 
debts and of standing ar- 
mies may be fully com- 
prehended, the following 
statements are submitted : 

The debt of the United 
States at its highest point, 



Per capita of the principal commercial or manufacturing states 
of Europe which are solvent, and of the United States (omit- 
ting local taxation for departments, counties, cities, or for 
town purposes) : 
United States, not including 

payment upon the public 

debt, less than $4-50 



United States, including 
payment on the debt, 
not over 6.00 



Italy . 



Holland 10.90 



Belgium 11.00 



Great Britain 11. 8 



was eighty-four Germany 12 



m li 

dollars per head, which is 
now the average debt of 
the commercial and man- 
ufacturing states of Eu- 
rope specifically named 
in the ensuing statement. 
The debt of the United 
States is now less than 
twenty-three dollars per 



France, by taxation .... 18.00 



France, including annual 
deficit, over 19.00 



The true burden of taxation may not be measured even by 
the proportion vi'hich the taxes of one country bear to another. 
The measure of importance is what ratio do they bear to the 
productive capacity of each nation or state, and for what are 
they expended. These matters are treated in a subsequent 
table. 



84 



The ludustiHal Progress of the Nation. 



ACRES PER HEAD OF POPULATION AND DEBT 
PER ACRE. 

United States (omitting 
Alaska), acres 32.7 



Great Britain, German)', 
France, Italy, Holland, 
and Belgium, acres . . 



head (or including all State debts, less than twenty-seven dollars). 
The national debt — now twenty-three dollars — will probably all be 
paid within one generation from the date when it was incurred.' 

In the consideration of these various tables it must be borne in 

mind that the annual pro- 
duct of a nation or state 
is the source of all wages, 
taxes, rents, and profits, 
and that by so much as 
one element of these 
charges upon the annual 
product is greater must 
some other element be 
less. No scientific meth- 
od has yet been invented 
by which taxes can be 
made to stay Avhere they 
are first imposed. As ^ 
rule, taxation tends to dif- 
fuse itself over all con- 
sumption, and cannot be 
drawn in any large meas- 
ure from what would 
otherwise be rent or profit. 
Hence, when the product 
is small, the necessary cor- 
relative of high taxation 
is a low rate of wages or 
earnings. Therefore, low 
wages in Continental Eu- 

' Since this computation was made the reduction of debt has continued, and the 
amount of the national debt is now (May i, 1889) $1,101,605,428. 

There are some compensations even for political incapacity. The Congress elected 
in 1888 may prove more incapable of dealing with the subject of taxation than the one 
whose term expired March 4, 1889 ; therefore, the surplus revenue, which can only be 
expended for the reduction of debt, may continue to fall into the Treasury in an in- 
creasing measure. The actual burden of taxation by which the surplus is collected 
would not be any great matter, except for the bad methods and inconsistent laws under 
which it is collected. 

In the interval before the Congress which will be elected in 1890 is called upon to 
treat the subject, great progress will have been made in the education of the people 
upon the whole subject of taxation, — then legislation may become possible under which 
even the present revenues may continue to be collected, but in such a way that the re- 
mainder of the debt may be paid in a very short time, without any undue interference 
with the freely chosen pursuits of the people, whether they engage in agriculture, 
manufactures, or commerce. 



National debt of the 
United States (omitting 
Alaska) per acre . . . $00.73 



National debt of Great 
Britain, France, Ger- 
many, Italy, Holland, 
and Belgium, per acre, $ 



10.06 



The proportion of men under arms in the commercial and 
manufacturing states of Great Britain, France, Germany, 
Italy, Holland, and Belgium is 2,200,431. The cost of sus- 
taining these forces in the last fiscal j'ear was $493,505,520, or 
at the rate of $223 per man. 

The force which is actually under arms, aside from the re- 
serves, is at the ratio of one man to each 200 acres ; and the 
annual tax for his support averages $1.10 per acre. 

The average cost per man in the army and navy of the 
United States, including the cost of ships, fortifications, navy- 
yards, and all other war expenses, is about $1,600 annually 
per man. The ratio is one man under arms to each 51,000 
acres, and the annual tax for his support and for all other 
military purposes is a fraction over three cents per acre. 



The Relative Strengtk and Weakness of Nations. 85 

rope give no evidence of low cost of production, but rather indicate that 
the laborer is deprived of a large and undue share of his product by 
excessive taxation, chiefly for the destructive purposes of war or of 
preparation of war. 

The debt of all Europe in 1SS4 and 1885 was $22,158,000,000 

Population 334,000,000 

Debt of the principal solvent and commercial states of Europe — Great 

Britain, France, Germany, Netherlands, and Italy $13,269,447,000 

Population at last census 157,549,817 

Debt of the United States at its maximum, August i, 1865, liquidated 

and unliquidated, as computed by Hon. Hugh McCulloch, 

Secretary of Treasury $2,997,386,203 

Population 34, 748,000 

Debt of the United States, August i, 1886 $1,380,087,279 

Population as computed by E. B. Elliott, Actuary of the Treasury, 

August I, 1886 58,670,000 

These figures of almost inconceivable millions convey but little idea- 
to any one who is not accustomed to such comparisons ; it is only by 
considering them in relation to each person of the population, that the 
true measure begins to be defined. 

In the accompanying tables will be found statements of the debt per 
capita, the annual taxation per capita, the debt per acre, and also the 
proportion which the present standing armies bear to the population 
and to the men of arms-bearing age. 

Thus far all the facts which have been given have been taken from 
the " Financial Reform Almanac " of 1886, from the " Statesmen's Year- 
Book " of 1886, and from the official documents of the United States. 

I may now enter upon that part of my treatise which rests upon es- 
timates only. These estimates must be accepted for what they are 
worth. It is admitted that they are somewhat hopothetical. Are they 
sustained by facts ? 

The true income of a nation is not the money by which it is meas- 
ured ; it is, in fact, the product of its labor and capital, consisting of 
the materials for food, for clothing, for shelter, fuel, metals, and the 
like, converted and reconverted until ready for consumption. These 
products are measured in money's worth in the process of exchange, 
and it is important when making use of terms of money to carry with 
the measure of money the conception of the quantities of substance 
which money will buy, or which are exchanged for money. 

In a very few cases certain countries, like England, possess an 
income from foreign investments of capital previously saved ; but this 
is a very small element as compared to the value of its annual product. 

In the following tables this increase of income from foreign invest- 
ments has been considered with respect to the average value of the 
product per capita assigned to England. 



86 



The Indtistrial Progress of the Nation. 



Proportion of men of arms-bearing age in the standing armies and 
navies, not including reserves. 



Exetiipis. 



I have attempted to establish a comparison of the product, per 
capita, of European countries, as compared to this country, at its 
measure in money. The known factors in the problem are, first, the 
relative rates of wages paid in the several countries considered, each 
as compared to the other ; second, the relative amount of national 
taxation per capita. 

Another factor which may be deemed to be sufficiently well estab- 
lished for purposes of comparison is the value of the per capita annual 

product of the peo- 

STANDING ARMIES AND NAVIES OF EUROPE AND THE pie of the United 
UNITED STATES, K^ 

States, estmiated at 

Compared in ratio to the number of men of arms-bearing age, assuming , J j J i 

one in five of the population to be of that age. tWO hundred dol- 

Standing armies of Europe in actual service 3,854,752 lars' WOrtll tO Cach 

Men in the navies 268,622 

m , person. 

Total armed force 4,123,374 

Reserves ready for service at call 10,398,163 The family grOUp 

Total 14,521,537 in this country con- 

Substantially one in five of all men of arms-bearing age. sistS of a fraction 

over five persons ; 
Exempts. ^^^ proportion who 
15.13 were occupied for 
g gain was one in 2,90 
in the census year, 
and may be comput- 
ed as* one in three 
^ ■ at the present time. 
18.50 Two hundred dol- 
22. lars' worth per head 
24.40 would make the 
25. average product of 
321- each person work- 
ing for gain six hun- 
dred dollars' worth 
of product per year. 
The writer has 
himsielf devoted a 
great deal of exami- 
nation to this sub- 
ject, and his esti- 
81 of population, mate of two hundred 
dollars' worth per 



Proportion to total. 

All Europe i 

Italy I 

Holland i 

France i 

Russia X 

Germany i 

Belgium i 

Austria i 

. Great Britain i 

United States i 



16.13 
7.50 
II. 

13- 

17. 

19.50 

23. 

25.40 

26. 
322. 



Men in active service in armies and navies, omitting reserves : 



Russia . . 
Italy . . . 
France . 
Germany . 
Austria . . 
Great Britain 
Turkey . 
Spain . . 
Switzerland 
Holland 



Reserves 



1,004,507 
765,820 

575^959 
462,678 
298,501 
281,746 
180,404 
116,256 
113,368 
77,689 



Belgium . 46,539 
Sweden . 43,174 
Denmark. 37,725 
Greece . 33,187 
Portugal . 29,920 
Norway . 22,250 
Roumania 20,572 
Servia . . 13,079 



4,123,374 or I man in 
10,129,541 



United States. 



14,252,915 or I 
36,294 or I 



24 
1610 



Since this guarded computation was made, the armies of Europe have been increased, and it has been 
computed that one man in sixteen upon the continent is either under arms or held subject to arm at 
the call of the government. The actual force in the standing armies now exceeds the number given 
in the table after deducting a part of the force assigned thereto in Italy and the whole of the armed 
freemen of Switzerland. 



The Relative Strength and Weakness of Nations. 87 

head has been sustained by many other experts, ofificial and unofhcial. 
Accepting this measure as approximately true to the facts, it is held that 
the value of the product, per capita, of other countries may be based upon 
the value of the per capita product of this country, since the product 
of other countries must bear substantially the same proportion to the 
rates of wages and the per capita tax of such country as the product of 
this country bears to these known factors. 

In all the principal commercial and manufacturing countries of 
Europe and in the United States there is now such an amount of avail- 
able accumulated capital, as to make it certain that if there is any art 
or industry in which a rate or profit ranging from five per cent, to fifteen 
per cent, can be obtained, that branch of work will be quickly and 
surely undertaken. 

Hence it follows that if the sum of the wages at the current rate pre- 
vailing in each country can be ascertained, as well as the per capita 
taxes, we may ascertain the average value of the product of such labor 
by adding to these elements of cost from five per cent, to fifteen per 
cent, as the corresponding profit. In other words, there must be a 
necessary relation in the ratios which profits, wages, and taxes bear to 
each other in each commercial or manufacturing country, according to 
the respective conditions of industry in that country. 

For example, assuming that one person sustains two others in France 
as well as in this country, we know first that the average wages in 
France are not more than sixty per cent, the rate of wages in this 
country. We also know that national taxes are eighteen dollars per 
head in France and less than five dollars here. We need therefore 
only to establish the rate of profit which will induce the employment of 
capital in the arts which can be established in France in order to reach 
■an approximate estimate of the average value of the product of each 
person employed in productive industry. 

We may take as a class any group of skilled mechanics or artisans 
in the United States who earn two dollars a day or six hundred 
dollars a year, each one supporting two other persons. 

Their net wages each, free of iiational taxes, would be $585 

Their proportion of national taxes for three persons at $5 per capita 15 

Wages and taxes $600 

Now if any one can make ten per cent, upon this sum, capital will 
be found for the employment of such men, and their product will be 
sold at such ten per cent, advance, if no more can be had, or at six 
hundred and sixty dollars. 

This would make the final value of the product of such a workman 
six hundred and sixty dollars : divided into profits, sixty dollars ; 
taxes, fifteen dollars ; net wages, five hundred and eighty-five dollars. 



88 The hidttstrial Progress of the Nation. 

We know that the corresponding rate of wages of a French artisan 
would not exceed, on the average, sixty per cent, or three hundred and 
sixty dollars, and that the proportion of national taxes due from him 
and his two dependants would be fifty-four dollars. But the gross 
product of France being less than it is in this country, it may require a 
larger proportion of the product to be assigned to profits ; we will, 
therefore, call it fifteen per cent, on three hundred and sixty dollars, 
which is fifty-four dollars. This sum added to wages and taxes gives a 
gross value of the French workman's product, four hundred and four- 
teen dollars. 

The ratio in this comparison would be : 

Product, per workman, United States $66a 

" " " France » 414 

" " capita, United States 220 

" " France .■ 138 

On the other hand, if the average annual product is only one hun- 
dred and thirty-eight dollars' worth per head, or four hundred and four- 
teen dollars' worth for the earnings of one of a group of three by whom 
the two others are sustained, the reason is not that the work is not 
equal, but that the quantity of the product to each person is limited by 
the conditions under which the work is done. The same workman 
when removed to the United States may produce twice as much as in 
France with the same labor, if he can adjust himself to his new condi- 
tions. The German immigrant actually does so. Does it not follow 
that wages are the reflex or result of the labor of the workman derived 
from the sale of the product after profits and taxes have been set apart ? 
Hence all attempts to compare the cost of production of any article by 
comparing the rates of wages must be entirely fallacious unless all the 
conditions of production are the same. The rates of farm wages are^ 
on the average, four to five dollars per month with board, in Rhenish 
Prussia ; in the United States they are four to six times as much, but 
the money cost of producing a bushel of wheat in Prussia is double the 
cost in many parts of the West, where machinery is used to an extent 
unknown in Prussia, and almost impossible on account of the ver}r 
minute subdivision of the land. 

The causes of the variation of the product per workman and per 
capita are, of course, manifold. The principal causes must be variation 
'n : 

First. The natural resources of the country. 

Second. The efficiency of the workman in respect to mental training 
and manual or technical dexterity. 

Third. The efficiency of the tools or machinery used. 

Fourth. The full or deficient nutrition of the body. 



The Relative Strength and Weakness of Nations. 89 

Fift/i. The freedom from obstruction in exchanging the surplus of 
one art or industry for what is deficient in another, either one part with 
another in the same country, or one country with another. 

Upon this theory I have constructed the foregoing table, to which 
reference may be made, and while no claim for positive accuracy in the 
money estimates can be made for it, it may perhaps be accepted as 
relatively or proportionately correct. The facts sustain these propor- 
tions, and therefore prove the theory to be correct. 

Is it not also a matter of common observation that in a country like 
the United States, in which laborers are perfectly free, the transfer of 
land and of other property very easy and very promptly made, the use 
of machinery fully comprehended, and in which any new inventions 
speedily adopted, the product will be large in ratio to the number of 
persons employed ? 

Conversely, if the natural resources of a country are not large in 
ratio to the population, the transfer of land complex and difficult, ma- 
chinery inadequate, and improved tools not readily accepted, then the 
product will be small in ratio to the number of laborers. It follows 
that if taxation takes a large share of such small product, wages must 
be very low, and subsistence must be very meagre. 

In this country all conditions are favorable to low cost of produc- 
tion, low prices, and high wages, and therefore conducive to a widely 
extended commerce. Labor is effective, capital ample, and the aver- 
age burden of national taxation very light. The prices of our great 
staple products, such as grain, wool, and cotton, are practically deter- 
mined by competition in the markets of the world. From fifteen per 
cent, to twenty per cent, of the product of agriculture of the United 
States finds its market in foreign countries. Therefore the price of all 
products of agriculture is determined by the price which the surplus 
will bring for export. 

Agriculture represents the largest single industry ; and the product 
being very large in ratio to the number of men employed, because of 
the fertility of the soil and the use of machinery, it follows that when 
the low rate of taxes has been set aside and the ratio of profit has been 
assigned which is required in order that capital may be invested in 
agriculture, the rates of wages or the earning of farmers in this country 
are, relatively to other countries, very high. Under such conditions 
large earnings and high wages are the necessary correlative of the very 
low cost of the production of the staples of agriculture. One is the 
reflex of the other. 

Up to this time the conditions of and the wages in all other arts in 
the United States have been practically determined by reference to the 
condition of and wages in agriculture. All other arts which have been 
undertaken in this country are therefore governed by corresponding 



90 The htdustrial Progress of the Nation. 

rules ; namely, by the application of machinery under the best condi- 
tions, the largest product is assured with the least expenditure of labor. 
Therefore in all arts, with few exceptions, after the low rate of taxation 
and such profit as is necessary to induce the investment of capital 
have been set aside, the general rate of wages has been very high, be- 
cause the general cost of production has been low. The same rule, 
therefore, applies in all arts — that high wages or earnings are the 
reflex or complement of the large product, so long as labor and capital 
are left free to work together, and are not subjected to excessive taxa- 
tion. Hence no comparison of cost can be made by a comparison of 
wages unless all other conditions are identical. 

This fact was very clearly seen by the late Secretary Frelinghuysen, 
and his successor, Secretary Bayard, begins his instructions to consuls 
in these terms : " ' There are certain natural and artificial conditions 
which so largely affect the direct conditions of wages as to be entitled 
to consideration in any analytical examination of the great question of 
labor. ... It would be a legitimate field of inquiry to ascertain what 
are the conditions which enable England to manufacture machinery 
and other products at less prices than similar goods can be manufac- 
tured in France, and at prices equal to those in Germany, while the rates 
of wages paid to workmen engaged in such manufactories in England are, 
on the whole, higher than those paid for similar labor in France, and, 
as a foregoing table shows, more than double those paid in Germany.* 

" It is the wish of the State Department to pursue this inquiry in 
the direction indicated in this paragraph, and for this purpose the fol- 
lowing general instructions are given to consuls, reference being made 
to the specific forms of interrogatory appended hereto, or which will be 
sent hereafter." 

This apparent paradox of high wages and low cost becomes very 
simple when applied by any employer to his own experience. In a dull 
time, when it becomes necessary to discharge a part of the working 
force, which are the operatives first discharged ? Are they not those 
whose wages or earnings have been lowest — not those who have pre- 
viously earned the most for themselves ? Are not the men who earn 
the most for themselves retained because they are the most effective 
workmen, and therefore most capable of producing goods at the lowest 
cost ? Conversely, does not the fact which is apparently lost sight of 
by the proposed " organizers of labor " represent an absolute principle, 
namely, that the strong, industrious, and well-nourished manual 
laborer, or the skilful artisan or factory operative, will be substantially 
sure of continuous employment at the highest possible rates of wages 
when the less able or competent can find no steady occupation ? 

Is not the rule of universal application in civilized countries that 
there must be a certain ratio between the suin of the wages and the 



The Relative Strength and Weakness of Nations. 9 r 

taxes combined, and the profit which may be derived from the several 
arts and industries of each of the several countries ? . 

It has been admitted that in very poor countries where hand labor 
prevails in greater measure than the application of machinery, and 
where the taxes are very heavy while the product is very small, the 
ratio of profit must bear a larger proportion to the entire product than 
it does in a rich country where machinery is most fully applied and 
where taxes are low. 

In making the computations of the relative per capita product of 
the different countries, I have not attempted to cover this variation in 
the rate of profit, but I assume that, on the whole, any art in which 
capital can secure ten per cent, profit will be surely undertaken either 
in the United States or in England, France, Germany, and the Nether- 
lands. Perhaps not in Italy without a higher rate of profit. 

Upon this theory, and assuming that the product per capita of the 
United States may be valued at two hundred dollars' worth ; that of 
England, with its income from foreign investments added, may not 
exceed one hundred and seventy-five dollars' worth ; that of Great 
Britain and Ireland combined may be assumed not to exceed one 
hundred and fifty dollars' worth ; that of France as not exceeding one 
hundred and twenty dollars' worth ; that of Germany as not exceeding 
one hundred dollars' worth ; that of Italy as not exceeding eighty 
■dollars' worth ; such being substantially the ratios which the average 
rates of wages with the per capita national taxation added bear to each 
other, and to the wages and taxes of the United States, with corres- 
ponding profits added in each case. 

In order that this proposition may be made more clear, the table 
on page 92 is submitted in which the line representing the product of 
each country is divided off into sections : in the sections on the right 
will be found the national taxation per capita ; on the left, the value 
of what remains for distribution as wages, profits, and for municipal 
taxes. In the same table will be found the percentage which national 
taxes bear to the assumed per capita product. 

In considering these remainders after national taxes have been set 
off, it must be borne in mind that municipal taxation as well as profits 
doubtless take a larger proportion in the poorer countries than in the 
richer ones. Hence that part of the product which may be assigned 
as the wages or earnings of the working people becomes less and 
less in proportion to the whole product, as the product itself dimin- 
ishes in quantity and in value. " For he that hath, to him shall be 
given : and he that hath not, from him shall be taken even that which 
he hath." 

These figures correspond to known facts. In Italy, which is rel- 
atively under a heavier burden of armies and taxes than any one of the 



92 



The Industrial Progress of the Nation. 



countries treated, what is left to the workman, either of his own product 
or what he can buy with his wages, now appears to be insufficient tO' 



RELATIVK PRCn'OKTlON OV THl'. ASSHMKH PROOUCT VKR CAPITA WHICH IS 
'\l5SORI5KD BY NATIONAI, I'AXAl'lON ONLY, ON I'HF, P.ASIS OF 
PKFA'IOUS COMrUl'ATIUNS. 
The proportion divided off at the end represents national taxation. The 
remainder is what is left to be applied to local taxation, rent, profits, earn- 
ings, and wages. 

United States, prodnct estimated $200 per capita. 



^ys- 



Knt;Uind, prodni't cstiiu.Uril $17S P' 



\05-u7 



Great Britain and Ireland, proiluct estimated if 150 per capita. 



f, product estimated $120 per capita. 



JiK-t estimated $100 per capita. 



Italy, prodnct estimated $So per capita. 



OS 70 



l'rt>portion of national taxation to estimated product : 
United States ji 



pel 



Knglaud 6,74 

Great IWitaiii .>ud Ireland 7.S7 

Germany u 



On revising these 
articles in April, 1889,. 
for republicatioti in 
book form, I find no- 
reason to make any 
inaterial change in the 
figures of this table. 
Investigations which 
have been made in 
France have proved 
that the average rate 
of ta.xation given for 
eachstatewassvibstan- 
tially correct, but fur- 
ther investigations in 
respect to the value of 
the product per capita 
in European countries 
would lead me to re- 
duce the figures of 
production, except it\ 
England. Since the 
publication of this. 
article the burden of 
European armies and 
debts has gone on in- 
creasing, and the ten- 
dency to revolution 

and repudiation becomes more manifest as time goes on. Objection has been taken to 
these comparisons upon the ground that taxation for local and municipal expenditure 
should also be compared in order to reach just conclusions. In this view I do not 
coiicur, because the revenues which are raised by taxation for department, couiity, city, 
and town expenditure in Europe and for State expenditure iit this country, are 
mainly used for the support of roatls, bridges, schools, police, and for providing water 
and ill many cases gas ; all of w hich are necessary to the organization of society, and 
are constructive rather than destructive in their nature. On the other hand but a small 
proportion of the national expenditures are constructive or necessary to the organi- 
zation of society, the greater portioti of such taxes being devoted to the support of 
armies, navies, and dynasties, or to the payment of interest on debts which \\ere incurred 
for war, and were imposed by dynastic goven^ments upon the people without their 
consent. As the time approaches when democratic governments may displace the 
present dynastic rulers and do away with class privileges, the question may arise by 
what right these great national ixiortgages were imposed upon the people of the present 
day by the rulers of the past. The growth of national debts arid standing armies has 
mainly occurred since the beginning of the present century : the question may well be 
asked how soon the people of Europe will refuse to bear the load which now seenis to 
be as impossible to be borne much longer as it is incapable of being thrown off except 
by the most violent outbreak of revolution and by general repudiation. 



Itj 



•MS 



France. 



The Relative Strength and Weakness of Nations. 93 

sustain life in strength and vigor. Is it not also true that pjortions of 
the population of the German empire, especially in southern Germany, 
are living on the edge of starvation, becoming weaker as they become 
less well nourished ? 

In Egypt so much of the miserable product of a rich and productive 
country is taken away to meet the interest of a bonded debt imposed 
upon the people without their consent, that starvation exists in the 
Nile valley, which has once sustained tenfold the present population 
in comfort. While so-called Christian nations have followed the 
Pagan example and have again combined "to despoil the Egyptians" 
by enforcing taxes at the point of the bayonet and the mouth of the 
cannon, to pay interest upon a debt imposed by a foreign ruler, whose 
successor has been found incapable of collecting the tax except when 
sustained by a foreign force, when the oppressed people attempted to 
resist the wrong I 

Is it not true that France has reached its utmost limit of taxation, 
and the annual deficit is adding to the burden which cannot, perhaps, 
be borne much longer.? Yet France may be saved from immediate 
bankruptcy by the richness of its soil and the intelligent economy of 
its people. 

Is not the present burden upon Ireland the burning question in 
Great Britain ? 

May there not be found in these conditions the underlying causes 
of nihilism, anarchy, socialism, and communism upon the continent 
of Europe ? As one witnessess the malignant effect of the burden of 
national debts, and the power which is given to the great financial 
magnates of Europe to control events for nefarious purposes, one 
cannot help looking forward to a time, perhaps not very distant, when 
the power and right of one generation to mortgage the labor of 
those who come after them for the conduct of wars will be contested, 
and when the jurists may declare that no debt incurred for purposes 
of war shall be lawfully binding upon those who come after. When 
pay as you fight becomes the rule and practice of nations, the power 
of dynasties to oppress the people will be almost wholly taken from 
them. 

In considering what is left after taxes and profits have been set aside 
in these several countries, it must be remembered that an equal amount 
of money will buy a less amount of food in Europe than it will in the 
United States, and the price of food is much more than half the cost of 
subsistence to a very large proportion of the working people of 
Europe ; else we should not be exporting the products of our fields to 
European countries, and there would be no call for prohibitory laws, 
or for high duties on grain and pork in a vain attempt to promote 
an increase of the farm products in Germany and in France by such 
artificial methods. 



94 The Industrial Progress of the Nation. 

The true measure of these burdens upon industry may be, perhaps^ 
more accurately measured in terms of work than when stated in terms 
of money or of men. The product of every country stands for so 
much work. In the census year the work of this country, manual, 
mental, mechanical, and manufacturing, was performed by one in three 
of the population so far as gain in money was the object of the work, 
the bread-winners numbering 17,400,000 in a little over 50,000,000 
population. 

The national and municipal taxes of that year were proportionately 
higher than they are now ; all taxes, national. State, and municipal, in 
that year required substantially seven per cent, of the highest estimate 
of the value of total product to be applied to them. This percentage 
being applied to persons, represented the year's work of men numbering 
1,218,000, whose labor was devoted either to the direct work of govern- 
ment, or in sustaining all the forms of government by way of national, 
town, city, county, and State taxes. 

The national taxes only of the United States are now about two and 
a half per cent, of the product, and they therefore represent the work 
of 500,000 persons out of about 20,000,000 workers. This body of half 
a million persons is either employed directly in the service of the gov- 
ernment, or else is occupied in sustaining those who are in such service. 

If the burden upon the United States corresponded to the several 
percentages assigned to other countries, the number who would be en- 
gaged either in the service of the government, civil or military, or in 
sustaining those who perform this work, would be according to the fol- 
lowing computation, it being assumed that out of our present popula- 
tion, approaching sixty million persons, twenty millions are at work in 
various occupations in sustaining the whole body politic : 

At the ratio which the national taxes now bear to product in the 
United States, the actual work required to sustain all the functions 

of the National Government, directly or indirectly, is that of 500,000 men. 

At the ratio which the national taxes bear to the assumed product of 
England, the proportionate number of men who would be required 
in support of the functions of government in the United States 

would be 1,348,000 

At the ratio assigned to Great Britain and Ireland as a whole 1,574,000 

" " " " " France 3,000,000 

" " " " " Germany 2,400,000 

" " " " " Italy " 2,950,000 

It will be apparent to any one who reasons upon these figures that 
if either one of these proportionate services in sustaining government, 
except perhaps that of Great Britain, were in force in this country, it 
would put a strain even upon our abundant resources that we could 
scarcely bear. What must then be the burden upon those who are 
thus loaded ? 



The Relative Strength and Weakness of Nations. 95 

The computed product of two hundred dollars' worth per head of 
our population, after setting aside ten per cent, as the maximum addi- 
tion to capital, and six per cent, as the maximum of all our present 
national and municipal taxes, leaves only one hundred and sixty-eight 
dollars' worth to each man, woman, and child. This being divided by 
three hundred and sixty-five days in the year leaves but forty-six cents* 
worth per day for shelter, clothing, and food for each person. A 
variation of five cents per day to each person from this computed 
average stands for an additional product worth more than $1,000,000,000 
a year. 

Let it be assumed for a moment that our two hundred dollars' 
worth of product, of which two and a half per cent, supports the 
National Government, were depleted by national taxation to the extent 
of fifteen per cent., as the product of France now is, a difference of 
twelve and a half per cent.; then the average sum available to each per- 
son per day would be reduced from forty-six cents to a fraction under 
thirty-nine cents ; not apparently a great variation, — only about the 
price of a glass of beer, — yet six cents a day comes to over $1,300,000,- 
000 on our present population. 

If we assume that one in three of the population of Great Britain,- 
France, Germany, and Italy is occupied for gain, the whole number of 
workers is a fraction less than 50,000,000 out of a population a little 
less than 150,000,000. 

At the respective ratios assigned to the functions of government, the 
total number engaged in such functions is now in those four countries 
6,067,000, or a fraction over twelve per cent, of the whole working 
force, thus occupied either as soldiers in active service, as officials in 
civil service, or in sustaining these classes with bread, meat, and shelter. 
The actual number of men under arms in these countries is 2,086,000, 
and they cost two hundred and twenty-five dollars each. It surely 
takes at least one peasant's or one operative's product to sustain one 
soldier. If the armies and navies require the services of 2,086,000 men, 
and if the work of as many more is required to sustain them, -then the 
waste of preparation for war requires the constant work of 4,176,000 
men out of 30,000,000 men of arms-bearing age in Great Britain, France, 
German^y, and Italy, computing one in five of the population of arms- 
bearing age. This is very nearly one in every seven of the adult men. 
Deducting this number from the whole number assigned to government 
service as above, 6,067,000, the remainder is 1,891,000, or proportion- 
ately about fifty per cent, more than have been assigned to the support 
of the National Government of the United States aside from their army 
and navy. The number needed to earn the interest on the national 
debts of those countries above the proportion required in the United 
States would fully account for this disparity. 



96 The Indttstrial Progress of the Nation. 

Do not these facts sustain the approximate accuracy of all the pre- 
ceding computations ? Does not the burden of armaments only require 
ten to twelve per cent, of the whole number of men of arms-bearing 
age in those countries, or eight to ten per cent, of the whole working 
force, if the proportion of working men and women to the population is 
the same as in the United States ; to wit, one in three ? 

But is such the proportion of men and women who must labor to 
the utmost for subsistence ? When men are wasting their time in 
camp and barracks, are not the women and children forced to labor in 
such a way that the physical stamina of the race is deteriorated, and 
material prosperity sapped at its very foundation ? 

What must then be the necessary conditions of life when the 
money's worth to be divided among the families of those who do the 
actual work of production is only one half as much as it is in the 
United States ? If the product of Germany is only one hundred 
dollars' worth per head, it will yield less than twenty-eight cents' worth 
per day for all taxes, subsistence, profits, and wages to each person. 
If the product of Italy is worth only eighty dollars per head, all taxes, 
profits, and wages must be derived from twenty-two cejits' worth per day 
to each person. 

If, on the other hand, the average value of the product per capita 
of these European countries cannot be deduced a priori according to 
the theory presented, then again we must go back to the facts ; and 
we then find in all the various reports upon the condition of a vast body 
of the population of Europe that they are actually subsisting upon 
much less than half the income of the working people of this country. 
The facts sustain the theory, and the theory may explain the facts. 

Many records may be found in recent consular reports of the 
families of German and Italian peasants who are subsisted on only 
four to five cents' worth of food for each person per day ; and even at 
that price the cost of food is sixty or seventy per cent, of the whole 
cost of living. 

On the other hand, if such are the facts as to common life of great 
masses of the people, and if we cannot deduce the per capita annual 
product of each worker in Europe by adding ten per cent, for profit 
or addition to capital to the average rate of wages and the average 
burden of taxes, — that is to say, if ihe product of either country is 
greater per capita than this measure, then it follows that the privileged 
classes of Europe are securing to their own use a very much larger 
share of the annual product than the capitalists of this country can thus 
secure ; and this adds to the danger and complexity of the problem in 
Europe, rather than rendering it more simple. 

What then do these figures and facts mean ? Is not the apparent 
strength of the armaments of European nations a source of weakness 



The Relative Strength and Weakness of Nations. 97 

which is now working at and undermining the foundation of the 
present forms of society upon the continent ? 

Is not our apparent weakness the very source of our strength ? 

Are we not stronger without expensive fortifications, navies, and 
other armaments than we should be if we spent our force in construct- 
ing them ? 

May not the time be near at hand when it shall no longer be lawful 
for one generation to mortgage the labor of the next by any national 
and perhaps by any municipal debt ? When pay as you fight becomes 
the rule, will not war become almost impossible ? 

May not the right government of cities be found in more strictly 
limiting the power of cities or towns to incur debts ? 

Has not the power of the rings which have plundered our great 
■cities been founded mainly in the abuse of public credit ? Could 
Tweed have stolen the property of the people of the city of New York 
had he plundered them by direct taxation ? 

These may be questions which will soon require an answer, and 
which are perhaps suggested by the figures and the facts submitted in 
this treatise. 

It may be said that the present relative conditions of Europe as 
compared to the United States require no statistics to bring them into 
view. Perhaps not ; yet when a great bankruptcy occurs or is impend- 
ing, the first call of the business man is for a trial balance. Such 
bankruptcies sometimes occur in arts which are most necessary and 
must be continued. When the settlement has been made after the 
bankruptcy, the business is reestablished, but the expensive super- 
numeraries who had previously lived upon the work of others, are after- 
ward set to work to earn their own living. 

In what way the representatives of the dynasties and privileged 
classes of Europe, or those whose present trade is war, will get their 
living after a hungry democracy has called for a settlement of accounts 
will be an interesting problem to watch. 

The business of government is necessary and must be continued. 
How will it be reorganized after the impending settlement of accounts 
in Europe has been completed ? 

Many other applications of the statistics of these two studies will 
suggest themselves to him who can read what is written between the 
graphical lines or underneath the figures. Except to one who pos- 
sesses such an imagination, statistics may be but dry bones, and all 
figures may be mere rubbish. 
7 



LOW PRICES. HIGH WAGES. SMALL PROFITS 

WHAT MAKES THEM? 



LOW PRICES, HIGH WAGES, SMALL PROFITS: — 

WHAT AIAKES THEM?' 



I because there has been in recent years a great reduction in the 
J^ prices of nearly all the leading articles of commerce, the prin- 



^HE minds of many persons have been and are greatly disturbed 



^cipal decline dating substantially from the year 1873. This decline in 

\ prices began soon after the war in the United States, but the general 

0>>decline in all countries on a specie basis may be dated from 1873. 

'^^x By whatever standard prices are measured (and there are many 

( carefully compiled tables), the average is found to be lower at the pres- 

'^ent time than at any period since a date anterior to the year 1850, in 

^ which year the great supply of gold from California, and a little later 

— that from Australia, began to affect the volume of the money metals of 

the world. 

In most of the discussions of the money question this great fall in 
prices has been treated as if it were a misfortune, and it is often held 
that any measure of legislation ought to be adopted which might tend 
to check it. Is not this a very partial and one-sided view of the sub- 
ject ? 

Some one has wisely and wittily said that " it does not much matter 
what happens to the millionaire — how is it with the million ? " 

If it shall appear that out of this great reduction in prices the mil- 
lions have gained higher wages ; that hundreds of thousands of families 
have gained better homes and greater comfort in life ; while those who 
have suffered temporary loss have been only the rich who have been 
incapable of adjusting themselves to the new conditions, or the un- 
skilled poor who have been unable to grasp the greater opportunities 
for welfare which invention has offered them, then may we not come 
to the conclusion that diminished profits and low prices are merely the 
complement of higher wages and lower cost, and are, therefore, most 
certain indications of general progress from poverty to welfare, yet still 
leaving the problem open, how to help the unskilled poor ? 

It will be remembered that it has been stated that so far as the great 
mass of the people of this and of other lands are concerned, about one 
' Reprinted from T/ie Century Magazine for August, 1887. 



I02 The Industrial Progress of the Nation. 

half the cost of living is the price paid for the materials for food, the 
cost of food to common laborers who have families to support being as 
a rule much more than one half their income. 

The question of interest to those who assume to be strictly '' the 
working classes " is not so much what the price of the necessities of life 
may be, as it is how many portions of food, fuel, and clothing each one 
can buy at the retail shops in which they deal, and how good a shelter 
each one can procure for one day's or one year's earnings. In other 
words, what is, or what has been, the value of a day's labor when con- 
verted into the commodities which are necessary to existence ? 

If these so-called " working classes " have steadily gained in the 
purchasing power of their wages or salaries, while farmers, who number 
(not including farm laborers) 250 in each 1,000, have also prospered 
during this period when prices have been falling and profits have been 
diminishing, then the economic history of the last 25 years may be pre- 
sented in an entirely new aspect. In such case, instead of attempting 
to check the fall in prices by tampering with the standard of value or 
by other empirical devices " for making money plenty," it may be ex- 
pedient to hold on to what has been gained and to fight it out on this 
line, even if several more years of so-called depression should follow 
this determination, these recent years of so-called depression having 
actually been years of greatest progress. 

Since the end of the civil war in T865, and yet more since the so- 
called panic of 1873, there has been greater progress in common wel- 
fare among the people of this country than ever before. It has been 
the period in which there has been the greatest application of science 
and invention to the production and distribution of food that ever 
occurred in any single generation in the history of this or any other 
country ; and food is the prime necessity of material life. 

In order to sustain this proposition, it is necessary to establish a 
standard of subsistence. This can be done with respect to the materi- 
als which are required for food, clothing, and fuel. Rent cannot be 
so surely included in this standard, because the conditions of shelter 
vary so much in diiferent parts of the country and in different cities. 

The cost of the materials for food, of materials for clothing, boots 
and shoes, and of fuel, probably represents about seventy per cent, of 
the cost of living on the part of well-to-do mechanics, railway em- 
ployees, or of other persons in analogous occupations who may be con- 
sidered in the average position of working people. All these elements 
of life have declined very greatly in their prices in the period under 
consideration. In some regions rents have declined, in others they 
have been stationary ; in crowded cities they have either advanced in 
some small measure, or else the apartments hired for a given sum of 
money have not been equal to those previously occupied. So far as I 



Law Prices, High Wages , Small Profits. 103 

^ave been able to compare rents, however, either those paid to a land- 
lord or the rental value of premises owned by the occupant, there has 
not been, on the average, much variation from the rule affecting com- 
modities in the period under consideration. 

The standard portions of food, cloth, boots and shoes, and fuel 
which are made use of in the subsequent computation of the purchas- 
ing power of a day's or a year's wages, have been established in the 
following manner : 

FOOD. 

By comparing data gathered by myself with other data gathered by 
several State Bureaus of the Statistics of Labor, it has been fairly es- 
tablished that the average food-supply of mechanics and adult factory 

Table A. — Standard of a Single Day's Table B. — Standard of 400 Rations, 

Ration, with its average cost in i8So, or i year's supply for i adult with 35 

'81, and '82. extra rations. 

^ to I lb. meat, poultry or fish, \ 200 lbs. corned beef, 

varying according to kind and > loo lbs. salt pork, 

quality, costing on average... 10 ) loo lbs. smoked ham. 

]4. to 7^ pints milk \ loo quarts milk. 

I to I '/| oz. butter >• 5 30 lbs. butter. 

^ to I4 oz. cheese ) 20 lbs. cheese. 

I egg every other day ^4 I7 doz. eggs. 

^ to I lb. bread 2}^ \ i barrel flour. 

) Yz barrel corn meal. 

Vegetables and roots 2 @ 2_54 20 bushels potatoes. 

Sugar and syrup 2 80 lbs, sugar. 

Tea and coffee i \ 4 lbs. tea. 

j 8 lbs coffee. 

Salt, spice, fruit, ice, and sundries ij/^ @ 2 $6 worth assumed at all dates. 

25 cts. $100 

STANDARD PORTION OF CLOTH FOR ONE YEAR: STANDARD OF BOOTS AND SHOES FOR ONE YEAR: 

10 yards medium brown cotton. 2 pairs men's heavy boots. 

10 " standard gingham. 

10 " 36. in. bleached shirting. Standard of fuel for i year : 

20 " printed calico. ,/ , ^1 -^ i ■<. • 

, (, ^ ^^ a ^ i.j 1/4 tons anthracite coal or its equiva- 

lo 4-oz woollen flannel, or worsted i . • u-» • ^ 3" 

^ J J ' lent in bituminous coal or wood, 
dress goods. 

5 " 16-0Z. cassimere. 

5 " Kentucky jean-satinet, or light 

cassimere. 

It is assumed that the prices of meat, fish, and poultry, fresh or salt, will have varied 
substantially with the variations in salt and smoked meats, and as the prices of the 
latter are more uniformly quoted, the prices used in making up the general standard 
are those given for salt and smoked meats. In the same way the price of potatoes has 
been taken as a standard for the variation in the price of all green vegetable food or 
roots. 

In establishing the average cost of a day's portion of the above, the prices given in 
Vol. XX. of the U. S. Census, in 10 shops east and 10 shops west of Buffalo, 1S60- 
1880, have been averaged for each year designated. These prices have been verified 
from other sources of information. Prices of dry goods have been verified fully. 
Prices for 1885 and '86 have been derived from typical establishments and from market 
reports. The average of 1885 and '86 was probably less than the estimate used. 



I04 The Industrial Progress of the Nation. 

operatives in the Eastern and Middle States cost in 1880, '81, and '82- 
substantially 25 cents per day, and consisted of very nearly the pro- 
portions of different kinds of food given in Table A. (page 103). 

The consumption of dairy products, sugar, tea, and coffee given, is 
probably greater than in other parts of the country ;_ but if a deduction 
of 2 cents per day be made for this, it then becomes necessary to add 
3 cents per day (probably more) to account for the known average 
consumption of wine, beer, and spirits. (60,000,000 at 3 cents per day 
average comes to $657,000,000.) Recent computations put the cost of 
liquor to consumers $700,000,000. 

Although the actual consumption of food, cloth, and fuel may not in 
any single case have corresponded identically with these standards, yet 
it may be safely assumed that the proportions are correct, and that the 
variation in the prices of what has been actually consumed will have 
corresponded to the variation in the prices of these standard articles 
and quantities. 

For convenience in computation the small quantities of the single 
ration of food have been extended so as to cover 400 portions, which 
may be taken as the consumption of one year by one adult, 35 rations 
being added for extras. 

CLOTHING. 

By a computation made by the writer when engaged in the 
compilation of the Census of the cotton manufacture of the United 
States in 1 880, it appeared that if all the fibres of cotton, wool, silk, and 
flax, imported or raised, were carried through the factories and then 
converted into clothing, carpets, and other forms for final use, with the 
imports of textile fabrics added, the average consumption of textile 
fabrics by the people of this country in that year was substantially $30 
worth per head, of which about $25 worth was for clothing. It being 
impossible to set up a standard of the exact cost of clothing, certain 
quantities of cotton and woollen cloth have been taken which are a 
little above the average consumption of the Avhole country. In a final 
computation, cloth is converted into clothing at the ratio of three parts 
materials, and two parts for manufacturing and distributing. 

In this computation I have made great use of the XXth Volume of 
the United States Census. It was prepared by Mr. Joseph D. Weeks,, 
and is of the greatest value in statistical research. 

BOOTS, SHOES, AND FUEL. 

The standard of boots and shoes, and of fuel is of necessity some- 
what arbitrary. It has been set at two pairs of men's heavy boots, as 
the equivalent of a customary supply, and one and one half tons of coal 
per adult per year ; it being assumed that, as the prices of these quan- 
tities have varied, actual use and cost will have varied. 



Low Prices, High Wages, Small Profits. 



105, 



The quantities assigned to this specific standard of subsistence 
have risen and fallen in the following proportions, the figures repre- 
senting so many cents per day for each standard portion, and the lines 
representing the relative variation at different periods : 

COST OF STANDARD PORTIONS OF MATERIALS 
For Food, for Clothing, Boots and Shoes, and Fuel, per Day, in Each Year as Designated. 



Materials for Food. 



i860 

1865 
1870 

1875 
1880 
1885 
1886 



33TffT)- 

22 



cts. 



Est. 



Materials for Clothing. 



i860 
1865 
1870 

1875 
1880 
1885 
1886 



4fTjV cts- 

C 07 
I 38 

4TTr% 



T B 



Est, 



Boots and Shoes. 



i860 
1865 
1870 

1875 
1880 
1885) 

1886 s 



cts. 



■•■TTTTr 



Est. 



i860 
1865 

1870 

1875 



1885 
1886 



o 3 7 
3 



Est.- 



It is doubtless true that the goods reported upon in the several shops from whose reports the prices 
have been derived, may have varied somewhat in quality ; but the questions put by Mr. Weeks were 
in such form that in nearly every case the prices are given for specific qualities of each kind of food, 
as for instance : Flour, grade " extra family " ; coffee, " Rio, roasted " ; sugar, several grades — I have 
selected a medium ; tea, " Oolong, or good black," etc., etc. These prices, taken from 20 shops — 10 
east and 10 west — have been averaged, and the results compared with other price-lists, many of which 
the writer has himself procured. 

It may be objected that this standard portion is only the one which 
is customarily consumed by each adult in the families of well-to-do 
mechanics or factory operatives in the Eastern or Middle States, and 
that it may not be a fair measure of those who are above this class, or 
of those who are much below them. This may be admitted ; but 
nevertheless all prices of the necessities of life must have varied sub- 
stantially as these standard portions have varied. Moreover this final 
fall in the prices of products at their final point of consumption could 
not have occurred had not the prices of the metals, of the machinery, 
and of the whole mechanism of production and distribution also fallen. 
Sometimes prices of invested capital have fallen even in greater 
measure than the prices of the products. It is only here and there that 
any important article like timber can be found, which having become 
more scarce, has either maintained its price throughout the period, or 
is even a little higher now than it was in i860. 

If, then, all prices have fallen and all profits have diminished while 
wages have risen, each subject to temporary fluctuation and variation^ 



io6 



The Industrial Progress of the Nation. 



must we not seek for deeper causes for the changes in the conditions 
of society and in the relations of men to each other than are commonly 
assigned in the explanation of such phenomena ? 

I now submit adequate proof of the facts. The subsequent table 
gives the purchasing power of wages at different dates, when converted 
into standard portions of food, cloth, and fuel as established. 

The quantities represented in these tables are assumed to have been 
established on the basis of actual consumption of a well-to-do mechanic 
in New England in the period of 1880, '81, and '82. If we convert the 
money assigned to each portion of food, fuel, clothing, etc., into 400 
portions corresponding to one year's consumption, with a margin of 
ten per cent, for extras, we get the following results : 



COST FOR ONE YEAR 

ONE PERSON. 

Food for one adult $100 

Materials for clothing 16 

Boots and shoes 7 

Fuel 9 



FOUR PERSONS. 

Food for four adults ' $400 

Materials for clothing 64 

Boots and shoes 28 

Fuel 36 



Gain in the purchasing power of wages, measured by the number of portions of the materials for 
food, clothing, boots and shoes, and fuel, which one year's work would buy at different periods : 300 
working days to one year. Each portion consisting of the same quantities and corresponding to the 
daily consumption of mechanics in New England and in the Middle States, as determined by close 
inquiry on the part of Bureaus of Labor Statistics, and of the writer. 

Class I. — Specially Skilled Men : Foremen, Overseers, Boss Blacksmiths, Carpenters, etc., 
Customarily Earning $3.00 to $5.00 per Day at the Present Time. 



i860 
1865 
1870 

1875 
1880 
1885 
1886 



Aver- 
age, 
per 
day. 

I2.45 

3-57 
4-34 
4.14 
4.14 



Average, 
per year, 
300 days. 

$735.00 
1071.00 
1302.00 
1242.00 
1242.00 



Probably higher 
than in 1880. 



Cost 
of day's 
portion. 

SOx^^TT Cts. 

SStwtt 
43x^0 

30TlTTr 
33x17(7 

Est. 30 cts. 
or less. 



Purchasing power in number of portions. 



2374 
1920 
3000 
3210 

3737 

Not less 
than 4000 



Class II. — Average Mechanics : Engineers, Blacksmiths, Carpenters, Machinists, and 
Painters Connected vstith Establishments Reported in Vol XX. of 
THE Census 1865 to 1880 Inclusive. 



Year. 
i860 
1865 
1870 

1875 
1880 

1885) 
1886 



Average, 
per day. 


Average, 
per year. 


$1.56 


$468.00 


2.34 


702 . 00 


2.43 


747.00 


2.29 


687.00 


2.26 


678.00 


Est. 2.40 


720.00 



Cost of portion. 

30x'(Aj cts. 
55to7 
43xto " 

qS 69 << 
3»T0^ 

33tot7 
Est. 30 cts. or less. 



1572 
1261 
1716 
1776 
2040 

Est. 2400 



Purchasing power. 



' Or for man and wife, one child over twelve, and two under twelve. 



Low Prices, High Wages, Small Profits. 107 

'Class III. — All the Operatives, except Foremen and Overseers, in ioo Establishments 
Reporting the Wages of their Working People under More than 1200 Separate 
Titles: Bricks, Marble, Furniture, Agricultural Implements, Tin Ware, Stoves, 
Boots, Hats, Cars, Wagons, Flour- and Saw-Mills, Iron, Paper, and Textiles, 
Employing Men, Women, and Children, from 20 to 20ck> in Each. 



Year. 

i860 
1S65 
1870 

1875 
1880 

1885 i 

1886 \ 



Average, 
per day. 


Average, 
per year. 


|i.33 


I399.OO 


1. 88 


564.00 


1.94 


582.00 


1-77 


531.00 


1.71 


513-00 


Est. 1.80 


540.00 

1 



Cost of uniform portions, 
food, cloth, and fuel. 

SOfrnr cts. 

55T(y(r 

43x07 

oQ 69 " 
3»T0T 
11 24 " 
JiToir 

Est. 30 cts. or less. 



Purchasing power in number of portions, 
1290 



IOI3 

1337 
1372 

1543 

1800 



Class IV. — Laborers, Computed Separately, Connected with above Establishments. 



Year. 


Average, 
per day. 


Average, 
per year. 


i860 


$1.01 


$303 . 00 


1865 


1.56 


468 . 00 


1870 


1.58 


474.00 


1875 


1.38 


414.00 


1880 


1-34 


402 . 00 


1885 ) 

1886 j 


Est. 1.40 


420.00 



Cost of uniform portions 
food, cloth, and fuel. 

SO^^^V cts. 
SStutt 
43^»Tr " 

oQ 69 << 
3°T7]T 

Est. 30 cts. or less. 



Purchasing power in number of portions. 
980 



840 
1090 
1070 
I2IO 

1400 



The portions consist of uniform quantities of the same kinds of food, cloth, etc., and fuel bought 
at retail prices. The wages from i860 to 1880, inclusive, are averaged from a large number of returns 
contained in Vol. XX. of the U. S. Census, compiled by Joseph D. Weeks. 

The cost of making and trimming, or of converting the cloth into 
clothing, would be for converting these specific quantities : 

For one adult $10 

For four adults 40 

These elements constitute on the average seventy per cent, of the 
expenditure of a family such as has been taken as an example. We 
may add 

For rent eighteen to twenty per cent $37-5o $150 

For sundries . . .twelve to ten per cent 20.50 82 

Totals .per adult, $200 ; per family, $800 

If we take the example of a mechanic sustaining himself, wife, one 
child over twelve years, and two under twelve counted as one adult, 
an average family of five persons counted as four adults, an expendi- 
ture of $800 per year would call upon the head of the family to earn 
$2.67 per day for three hundred working days in the year. 

It will be remarked that this standard has been reached theoretically^ 



io8 



The Industrial Progress of the Nation. 



° ts. 






on the basis of facts derived from obser- 
vations entirely independent of the actu- 
al statistics of the family expenditure 
gathered by Commissioner Carroll D. 
Wright, as Chief of the National Bureau 
of Labor Statistics, and until lately also 
of Massachusetts. On comparing these 
theoretic estimates with these statistics, 
they are found to correspond so closely 
with the actual facts gathered from many 
families, as to sustain the substantial ac- 
curacy of the proportions of the cost of 
living, the price of food being exactly 
one half. 

In the returns which have been made 
use of in compiling the tables given in 
this treatise, there are doubtless reports 
of prices of goods which do not exactly 
correspond to others either in kind or 
quality ; but so many returns have been 
averaged as to eliminate this cause of 
error. I have made many computations 
on single returns of prices in special 
places procured by myself, and I find 
that the proportional variations corres- 
pond so closely to the average of all as 
to establish the standard conclusively. 

In fact, the reduction in the cost of 
subsistence and the increase in the pur- 
chasing power of wages in the East have 
been greater than in the West, and great- 
er than the average of the whole country, 
doubtless owing to the equalizing force 
of the railroads in diminishing the cost 
of food. I may give one example for 
which I have collated all the figures 
myself in order to verify the compila- 
tions of the census. In this example I 
have taken the year 1866 as a starting- 
point, and a cotton-mill as the example. 
It is not a fair year to show an average 
in other arts, because the conditions of 
the cotton manufacture were very un- 
certain during that year ; and it was alsO' 



Low Prices, High Wages, Small Profits. 109 

in the year 1866 that the most malignant effect upon prices and wages, 
worked by the substitution of legal-tender notes in place of coin, was 
experienced in the United States. I have, however, selected a year in 
which the work was continuous during that year as well as during the 
year 1885 

The average earnings of all the hands in the factory through the year 

1 866 were 83 cents per day. 

In 1885 103 " " " 

The product of each hand in pounds of cloth was in 1866 7 pounds per day. 

1111885 13.34 " " " 

The cost of labor in the pound of cloth was in 1866 11.85 cents. 

In 18S5 7.67 " 

The cost of the standard portion of food, clothing, and fuel (sub- 
stituting three cords of wood for the customary portion of anthracite 
coal, because this factory was in a position where wood at that time 
was cheaper) was : 

Daily portion of food, clothing, and fuel in 1866, cost 57-82 cents per day. 

In 1885 30.97 " " " 

The purchasing power of 300 days' wages converted into these standard 

portions was in 1866 430 portions. 

In 1885 1000 " 

It will be remembered that the price of food is about one half the 
price of life to the class of persons represented in this example. Other 
examples have been computed by myself from private data in respect 
to the condition of operatives in woollen-mills and machine shops. 
They show the same law ; but as the condition of the woollen-mill and 
the machine shop was somewhat better in 1866 than that of the cotton- 
mill, the ratio of progress is more nearly that of the average of the 
whole country than is shown in this particular example. 

One very curious point is brought into notice by an analysis of the 
average food ration of the American workman. All the pork could be 
spared, and yet the daily ration would be more than ample. The 
waste of this country is an excess of fat rather than an excess of any 
other part of the food consumed. We have often heard " the Ameri- 
can frying-pan " denounced ; but this is, I think, the first time that it 
has been subjected to a scientific condemnation. 

In a rough and ready way it takes five pounds of western corn to 
make a pound of pork. Even the hogs do not consume their whole 
ration ; they waste a part of it. The proportion is substantially one 
thousand pounds of Indian corn to a barrel of pork weighing two 
hundred pounds. In this conversion nearly all the starch and all 
the protein are wasted, and the fat which is left is not required for 
use. 

The necessary deduction is this, that the conversion of corn into 
pork is an absolute and total waste of nutritious food. Far better that 



no 



The Industrtat Progress of the Nation, 



corn should be converted into beef, or even burned for fuel (often a 
very economical expedient for settlers), rather than to be expended in 
this way. 

A curious question arises in this connection. If the world were 
convinced that the Jews were right, and that pork ought not to be 
eaten ; or if the American world were convinced that all the pork that 
is eaten is wasted, what would be the effect on the American farmers ? 

Having submitted this part of the problem to Professor Atwater, he 
makes the following remarks thereon : 

" Taking your figures for quantities of shelled corn and dressed pork, and the 
most reliable data I can find for their composition, I obtain the following figures : 

GAIN AND LOSS OF NUTRIENTS AND POTENTIAL ENERGY IN CONVERSION OF CORN INTO PORK. 





NUTRIENTS. 


POTENTIAL 




Protein. 


Fats. 


Carbo- 
hydrates. 


ENERGY. 


In looo lbs. of corn 


Potinds. 
lOO 

i8 


Pounds. 

45 
85 


Pounds. 
680 


Calories. 

16,400,000 
3,900,000 






Loss or gain ' 


82 loss 


40 gain 


680 loss 


12,500,000 





" In other words, the fat is increased by 40 pounds, and to offset this there is a 
loss of 82 pounds of protein and 680 pounds of carbohydrates. Estimated in potential 
energy, the loss makes over three fourths of the whole. 

' ' According to the best data at hand, and your ration agrees with them, our ordi- 
nary dietaries contain an excess of carbohydrates (sugar, starch, etc.) and a very large 
excess of fat. The ' condensing of corn into pork,' which we hear of as ' useful to save 
cost of transportation and handling,' means — 

'^ First. Practically throwing away a lot of protein, the most valuable of the food 
ingredients, and with it a large amount of carbohydrates. 

" Second. The conversion of part of the other nutrients into fats, so as to in- 
crease our already great excess of this material." 

This may seem a somewhat trifling matter. Let us see. 

Assuming that the product of this country, at its market value for 
final consumption or export, cannot exceed $200 worth per person^ 
$600 worth for each group of three of whom one is occupied for gain, 
or $1000 worth for each average family of 5 persons, it may be 
assumed that not exceeding to per cent., or $20 worth a year per cap- 
ita, can be saved, and added to the capital of the country, however 
such capital may be owned individually ; 5 to 6 per cent., or $10 to 
$12 a year, must be set aside to meet all forms of taxation — national, 
State, and municipal. There remains $168 @ $170 a year, which con- 
stitutes the wage fund, it being manifest that the source of all wages, 
earnings, taxes, and profits must be the annual product, whatever that 
product may be. 



Low Prices, High Wages, Small Profits. 1 1 1 

If these sums per year be reduced to portions per day, the wages 
or earnings of each person amount to a fraction over 46 cents per day, 
or $1.38 for every day in the year, including Sundays, secured by one 
person in three of the population who constitute the working forces. 
Profits amount to a fraction under 5^^ cents per day ; taxes to a frac- 
tion over 3 cents. The cost of the excess of fat and sugar in the 
standard ration is 7 cents out of 25. If this were saved and applied 
to shelter, the housing of the working people would be solved. 

There cannot be more to be divided than all there is. The whole 
question, therefore, of relative welfare and poverty consists in the 
manner in which this product is divided. 

The only way in which any great gain can be made is by increasing 
the quantity of product while decreasing the amount of capital and the 
hours or intensity of the work required in production, or else saving 
what is now wasted. Any other method of distribution that could be 
brought about might not very greatly improve the' condition of any very 
large number of persons. This will be made apparent by a few figures. 

If the sums given constitute all the money's worth there is to be 
divided, then by so much as some gain more must others gain less. 
The limit of all that is produced is the limit of al] that can be divided. 

The working group of this country, as I have stated, is substantially 
a group of three. One person in each three is occupied for gain, sus- 
taining two others. If that part of the product which is now saved 
were divided equally among those who do the work, it would add only 
about 15 cents a day to the income of each one, or $54.75 each year. 
In the present population of about sixty million, the number who are 
engaged in gainful occupation is twenty million. If the whole sum 
saved and added to capital were divided among this force equally at 
$54.75 each, it would represent a little more than $1,095,000,000. 

Suppose this sum now. saved were equally divided, — is it not true 
with regard to a very large proportion of those who do the work that 
the measure of their income is also the measure of their expenditure ? 
Could this equal division then be made without leading to an increased 
consumption rather than to additional savings on the part of the many ? 
If so, the next year's product of the whole country would suffer for lack 
of capital. It sounds like a paradox, but it may nevertheless be true, 
that the faculty for " making money," as it is called, — that is to say, 
the instinct that leads to accumulation on the part of the few, — is ab- 
solutely necessary to the comfortable subsistence of the many. Dis- 
parity in the possession and direction of capital is apparently necessary 
to its effective use — a big capital in the hands of a master is like a big 
steam-engine directed by a competent engineer ; each compasses three 
or four times as much product as the small capital held by many per- 
sons, or several small steam-engines each wasting fuel, can accomplish. 



I 12 



The Industrial Progress of the Nation. 



It may not be the disparity between rich and poor which is the sole 
cause of discontent. 

The disparity in the conditions is very much greater, and is in- 
creasing more rapidly among those who constitute the " working class- 
es " themselves, in the narrow use of that term, than any possible dis- 
parity between the capitalist classes and the working classes can ever 
be ; that is to say, the disparity of the aggregate income, class by class, 
is greater. 

The capitalists are working under an imperative law of diminishing 
profits. The workmen who do the work intelligently and skilfully are 
progressing under an imperative rule by which their wages are increased 
while the purchasing power of their wages is yet more increased. 

Is there not perhaps a more subtle but very potent cause of dis- 
content disclosed by the great disparity in the progress of working 
people themselves to the exclusion of capitalists, than can be found in 
the disparity of fortunes or in the possession of capital saved ? 

In the following table the relative progress of four classes whose 
condition has been fully analyzed is graphically pictured, each class com- 
pared to the other by the relative percentageof their gain since i860 • 













Sj3; 








^^^^^ 


/^Ui, 








/ 


■iroo • 






I 




/ 








2374 


"•\ 


'/<ji.o 






f~oW 


II 

1512 


^ 




iyi6 


'Tji 




III 

1290 


liiy 


^•37^- 


IV 

980 


/O'jO 


ioyo 



No. I. Foremen, overseers, boss blacksmiths, and carpenters or other workmen of 
special skill and aptitude. 

No. II. Average mechanics, engineers, blacksmiths, carpenters, machinists, paint- 
ers, and the like. 

No. III. Average workmen or women, in 100 factories or workshops, listed under 
more than 1200 titles, — bricks, marble, furniture, tools, stoves, boots and shoes, hats, 
cars, wagons, textiles, iron-works, paper-mills, etc. 

No. IV. Common laborers connected with the same establishments. 

The variation in the respective condition in these classes is shown 
by the number of portions of food, fuel, boots, and materials for cloth- 



Low Prices, High Wages, Small Profits 113 

ing which one year's earnings would purchase in each of the years desig- 
nated. The actual working of these changes can be better observed by 
a different form of diagram which gives the facts in relation to all the 
mechanics covered by class II : 




Wages. 
Prices. 



Purchasing 
lumm i power of 
wages. 



The malignant effect of war and paper money is shown by the rapid 
rise in prices, while wages slowly followed. After the war wages fell slow- 
ly, but prices fell rapidly. On the resumption of specie payments, wages 
again began to rise — prices continued to fall, and in 1885-6 the purchas- 
ing power of a day's work was greater than it ever had been before. 

In order that the full import of these figures may be comprehended, 
the table on page 114 is given, including a computation of rent on the 
best data which can be found. 

It will also be observed, however, that while work has been contin- 
uous since 1S73 or 1865 for all men of special skill and aptitude (vvith 
very rare exception for some short and exceptional period), and while 
work has also been continuous and well paid for every intelligent 
mechanic or artisan who has chosen to control his own affairs and to 
make his own bargains, it has been much less continuous for many 
classes of factory operatives of a lower grade, and it has been abso- 
lutely intermittent with respect to great numbers of common laborers. 
One of the penalties which society must pay for the application of 
science and invention to the useful arts is this temporary displacement 
of unskilled laborers from the occupations in which their work had 
been previously required, but which is no longer required when some 
new machine or improvement renders it unnecessary. 

On the other hand, without these applications of science to agri- 
culture and to manufactures, the normal increase of population would 
without question tend to outrun the means of subsistence. It therefore 
follows that by their application, while the few are for a time left be- 
hind in the race, the many gain in welfare ; the means of subsistence 
rapidly outrun the increase of population, and the many are thus 
enabled to enjoy better and better conditions of life. 

Thus the problem of " progress «;?^ poverty " marches alongside the 
actual progress/>(??« poverty. This problem of " progress ^«^ poverty " 



114 



The Industrial Progress of the Nation. 



calls for the urgent attention of the student and the statesman in order 
to abate the great disparity of condition which becomes more con- 
spicuous the more the general progress is assured. This special 
branch of the subject cannot be treated within the limits of the present 
treatise, but may be taken up at a future day. 

TIIK F(XJl), CLOTHING, RENT, FUKL, SUNDRIES.— RELATIVE IMPORTANCE 

OF I'.ACH. 

By a comparison of the average of all these elements of the cost of living, rent being 
also computed on the most adequate data which are available, and estimating "sun- 
dries " at lo ])er cent, of the whole, the relative importance of each element may be 
comprehended. 

iSOo to iSSo inc. census data vcrifLcd by other authorities. 

Food, per day... 22 ^Vo- @ SSirff. ^^er. 291% cts.. 
Clothing, pcrday, ^iSs " i^'ioV " QiVff 
Rent, per day... C/'o'V " ^-^^^ " 7-/0^ 
Fuel, per day... 2^~j«o- " ^Im " 3roV 
Sundries, per day 5 raff 

Total 561V0- 

Proportion of rent paid on land, assum- 
ing house and land equal value. . . . 3iVo" " ~~ 
Elements of tlic cost of living in New England in 1885 and 1886, based on the 
prices of the same quantities of the same articles computed above, mainly from census 
figures. Prices ascertained ])y the writer on a narrower field than that covered by the 
census. 

Food, ])cr day 22 cts. 

Clothing 

Rent 

Fuel 

Sundries 4iV(r 



" 1 ff 
7 

o BO 
2 4_ 



Total 42i"off " 

Average, i860 @ 1880, inclusive S^^iVff " 

Estimate, 1885 and 1886 42-/o''ff " 



Tola! reduction in 1885-86 iSxoff 



According to Prof. Atwater's analysis, the ratif)n of ft)od made use of in the above 
computations is 40 per cent, in excess of what is needed. All the pork, and one half 
the sugar, or one half the potatoes could be spared. This reduction in the quantity of 
food would reduce the present cost of this ration from 22 to 15 cents per day. If the 
.sum thus saved in food were expended for shelter, the whole question of providing bet- 
ter dwelling-places might be solved. On this basis the proportion would be : 

Food, per day /. 15 cts. 

Clothing, per day ^\^<s 

Rent 14 

Fuel 2^"^ 

Sundries 4T(rff 



Total cost of subsistence per day A~\^'s 

The importance of the food question could not, I think, be more clearly enforced. 



Low Prices, High Wages, Small Prqfils. 1 1 5 

We will now take up some of the theories which have been set up 
in the endeavor to explain the fall in prices since 1873. Subsequent 
to the year 1850, and either accompanying or perhaps caused in part 
by the very sudden and very great addition of gold to the volume oi 
the money metals of the world, there was a great advance in the prices 
of all the necessities of life, subject, of course, to temporary fluctuations. 
This period of general advance in prices culminated in the years 1872 
and 1873, reductions in the prices of cotton and of some other articles 
having begun before. Since 1873 ^ great and general reduction of 
prices has taken place the world over. What has been called depres- 
sion has been more common than activity in commerce. These long 
periods of depression have affected nearly all commercial and manu- 
facturing countries alike, without much apparent regard to their system 
of taxation ; to their standard of value, whether it has been based on 
gold only, on silver only, or on both metals ; or v/hether the standard 
of value has been a paper substitute for true money. 

It happens that during this period, dating from 1873, all the import- 
ant changes in legislation respecting legal tender have occurred, yet 
the great international commerce of the world has proceeded in its 
customary way, because it is not possible to apply acts of legal tender 
to international exchanges ; therefore this branch of commerce has been 
conducted on a solid basis of a given weight of the metal gold. But 
notwithstanding the stability of the gold standard of international com- 
merce, great fluctuations have occurred, and periods of depression have 
affected international commerce as well as the domestic commerce of 
many countries. 

Since 1873 Germany has displaced silver from its function of legal 
tender ; the Latin Union soon ceased the coinage of silver ; the United 
States have resumed specie payment upon a gold basis ; Italy has also 
resumed specie payment. All these changes have doubtless tended to 
the use of gold as the unit of value of full legal tender among the so- 
called civilized countries of the world. Yet all these changes com- 
bined have required the substitution of gold for other forms of money 
only in the bank reserves of Germany and in the sub-treasury of the 
United States. Silver has not been demonetized anywhere. It is still 
money in a true sense in England, Germany, and France, as well as in 
India, Africa, and South America. The ohly change brought about by 
legislation has been in the substitution of a single kind of money as full 
legal tender, for two kinds. 

But it has been assumed by many writers of repute that these 
changed conditions in acts of legal tender must have caused a steady 
and slow, but unceasing appreciation in the value of gold as compared 
to all other commodities, silver included. 

On the other hand, it is held by many writers of repute that the vast 
store of gold which has been added to the money metal of the world 



1 16 The Iitdustrial Pi'ogress of the Nation. 

since 1850 has not only actually depreciated gold, but has also caused 
a yet greater depreciation in the value of silver, under the well- 
established rule that a substitution of a better article for common use 
may displace a substance of a poorer kind, and may cause the latter 
kind to lose a part of its value, even if the product of the latter be 
very much less in proportion than that of the former. 

Such are the facts in regard to gold and silver. The addition of gold 
since 1850 has been vastly greater than the addition of silver. 

The computed production of gold, 1849 to 1884, inclusive, has been 
$3,882,975,000. That of silver, $2,250,375,000. 

This reference to the money metals is secondary to the main pur- 
pose of calling attention to an entirely different class of price-making 
factors. Under the conditions which have been presented, the battle 
of the standards has been waged with great virulence ; but, perhaps, in 
consequence of this contest too little attention has been given to the 
really great forces which have been in action, and which have caused 
the reduction in prices which are so apparent. 

The discussion of what I call the price-making factors will be 
mainly limited to the conditions which prevailed in the United States. 
For this reason, since 1865 there has been no war and no great prepa- 
ration for war to alter the influence of the forces which make for peace 
and plenty. In Europe, on the other hand, actual wars, or enormous 
preparations for war, have altered all the conditions. 

The change in prices in this country since i860 must, of course, be 
in part attributed — 

First. For a limited period to the forced circulation of paper sub- 
stitutes for money which depreciated in. value. 

Second. To the restoration of the value of the previously depreciated 
paper to the standard of the only legal unit of value in this country, — 
to wit, the dollar made of gold. 

No writer or observer of any repute has ever contested the fact that 
the rapid substitution of legal-tender notes for coined money always 
causes the depreciation of such notes and an increase in prices. 

. This sudden change in the standard of value is very different from 
the slow and steady addition of a very small annual percentage of pre- 
cious metal to the previously existing stock, however large the volume 
of such addition of metal may appear to be when computed separately, 
year by year.' 

In the tables which I have given, the malignant effect of the substi- 
tution of depreciated legal-tender notes for true money is made appa- 
rent by the much more rapid rise in prices than in wages or earnings 

' It has been for many years about half per cent, of gold and half per cent, of 
silver, which has been added year by year to the existing volume according to the esti- 
mates of Henri Cernuschi. 



Low Prices, High Wages, Small Profits. 1 1 7 

from i860 to 1865, thereby greatly diminishing the purchasing power of 
labor. Since that difficulty has been surmounted in part or wholly, the 
purchasing power of labor has greatly increased, gaining steadily the 
nearer the specie standard has been attained, and gaining yet more 
steadily the more closely it has been adhered to. 

It may well be asked, if the reduction in the prices of the necessi- 
ties of life could be attributed to a scarcity of gold, would not wages or 
earnings — that is, the price of labor — have been reduced in the same 
proportion ? 

May it not be held that labor in the concrete form of commodities, 
or, as we might say, in the passive form of commodities, could not be 
reduced in price by any such cause as a scarcity of gold without labor 
in the active form of work in the production of commodities being also 
reduced in price ? If the true cause of the reduction in prices has been 
an appreciation or rise in the value of the metal gold, would it not of 
necessity have happened that the price of labor would have been 
affected in the same way ? Would not the price of real estate have also 
been affected in the same way ? 

Again, if the cause of the reduction in prices had been an increased 
scarcity of gold, would not capital, when measured by the gold stand- 
ard, have been able to secure to itself a constantly increasing rate of 
interest or income ? 

Now it happens that, in the United States, in so far as the specie 
standard of value has been departed from has the purchasing power of 
labor become less, while the earning power of capital has become 
greater ; conversely, in the exact measure that the specie standard has 
been adhered to and sustained has the purchasing power of labor 
become greater, and the earning power of capital less. 

Important as the settlement of the contest between those who sus- 
tain the double standard of gold and silver with the advocates of the 
single gold standard admittedly is, yet it is held that the battle of the 
standards cannot be settled without a full consideration of all the other 
factors which tend to alter prices to which reference is made in this 
article. 

Although the war of the Rebellion required the work directly or in- 
directly of one in three of all men of arms-bearing age throughout the 
country, yet during this period there was no decrease in the production 
of articles necessary to subsistence, with the single exception of cotton. 
This fact gives evidence of the vast progress which must have been 
made in the application of science and invention to all the useful arts. 
The abnormal demands of war counterbalanced in some degree the 
malignant influences of the substitution of paper promises for true 
money ; yet the prices of all commodities advanced very rapidly, while 
wages advanced much more slowly. 



1 18 The Industrial Progress of the Nation. 

After the war, production gained immediately and enormously on 
population in respect to food, fuel, metals, and fibres. Wages ceased 
to advance in rates by the measure of money, but the money ceased to 
depreciate. The armies of both parties in the conflict were absorbed 
in the pursuits of industry within less than a year from the end of the 
war. In spite of this increase in the supply of labor, as soon as the 
policy of the government began to tend toward the resumption of spe- 
cie payments, on or about 1870, although the prices of both commod- 
ities and labor began to decline in their nominal rates, yet, on the other 
hand, the purchasing power of wages — that is, the absolute wages of 
labor — began to increase with great rapidity. The value of a day's 
labor to him who exerted it, yielded more and more of the necessities 
and comforts of life as the years went by. Presently wages began to 
advance again, but prices continued to decline. 

In a previous number of The Century, I have given a table showing 
the increased product of railway mileage and of property insured 
against fire between 1865 and 18S5.' Objection has been taken to the 
date of 1865 as the starting-point, upon the ground that in that year 
the country had not surmounted the difficulties and retardation of the 
Civil War. In the year 1870, however, all the causes of retardation 
growing out of the war had been removed, and the country was fairly 
headed toward the resumption of specie payments, which took place on 
the 1st of January, 1879. A table showing our progress since 1870 is 
therefore given now : 

Gain in Population, Production, Wealth, and Savings 1870 to 1885 and on Some Items to 1886. 
To 

1885 Population 48 

1883 Production of grain 85 

1885 Consumption of cotton ... 86 
1885 Consumption of wool .... 88 

1885 Production of hay 100 

1885 Deposits in savings-banks 

of Massacliusetts 102 

1885 Production of cotton 108 

1886 Deposits in savings-banks 

of Massachusetts 115 

1883 Production of iron 143 

1883 Insurance of property 

against loss by fire 160 

1885 Miles of railroad 168 

1886 Miles of railroad 192 

1886 Production of iron 200 \, 

In considering these relative gains, it will be observed that they represent a constant gain in the 
means of subsistence over population — that with the exception of the increase in personal wealth, which 
is indicated by the increase in the amount of property insured against loss by fire, they represent the 
progress of the million in the means of common welfare rather than of the millionaire in perA)nal 
wealth, and that they give testimony to the beneficent law of progress y>-OT;z poverty. 

While wages have risen, the earning power of capital has decreased. 
The actual reduction in the earning power of capital, considered 
simply by itself, may be represented by the current rate of interest ; 
the discount on the very best commercial paper at four or six months' 
date at different periods may be taken as a standard of the actual earn- 
ing power of capital. 

' See pages 58 and 66 of this work. 



Law Prices, High Wages, Small Profits. 1 19 

Prior to the financial panic of 1857, almost all the staple manufactures 
of the country were sold on 6, 8, 10, and sometimes 12 months' credit. 
After the commercial panic of 1857, and up to 1 861 at the opening of the 
war, the current credit was four months. During the war, and up to 
about 1870, the traffic of the people was mainly conducted on a cash 
basis, personal credit being rendered very uncertain by the variation 
in the value of paper substitutes for money. The instruments of 
exchange consisted of the depreciated notes of the United States. 
Bills of goods were rendered on ten to thirty days ; but commercial 
notes disappeared almost wholly from the market. 

Since 1870 there have been many variations in the customs of trade. 
In some kinds of business, notes have been given for actual purchases ; 
in others none such have been given, but money has been borrowed 
in other ways ; as, for instance, the large manufacturing corporations 
of the east have borrowed their working capital upon notes of the cor- 
poration, indorsed or guaranteed either by their officers or by the com- 
mission houses selling their goods, such notes being negotiated in the 
open market at four or six months, or placed in savings-banks. 

From 1848 to i860 the writer kept a record of transactions by him- 
self or by his associates in manufacturing corporations. The average 
rate of discount paid in the open market by the corporations enjoying 
the highest credit during this period was eight per cent, subject to 
very considerable fluctuations. From i860 to 1869, inclusive, the rates 
of discount varied greatly with the circumstances of each case. The 
war and the continued issue of legal-tender notes rendered any stand- 
ard of little moment. Railway corporations issued bonds at long 
date, at rates of interest from 7 to 8 per cent.; even as high as 10 per 
cent, was paid by railroad corporations of great strength and sound 
credit. In 1S70 the slow restoration of specie payment began. Up to 
1873, the year of panic, the rate of interest on the best manufacturing 
notes was on the average six and one half per cent. 

After the panic of 1873 ended, up to the ist of January, 1879, five 
per cent, was the rate. Since the restoration of the specie standard at 
the latter date, down to the present time, the fluctuations in the rate of 
discount on the very best commercial notes have been 3 to 5 per cent.; 
and by the actual record of a broker doing a very large business, they 
have averaged 4 per cent, on 6 months' paper. 

By the kindness of Mr. Lyman J. Gage, of Chicago, I have obtained 
the rates of discount on commercial paper at that point. They are 
about the same in their proportion, having been reduced from an aver- 
age of 10 per cent, or over, to an average of 5 per cent, or less between 
the dates i860 and 1886. On Western farm mortgages the change has 
been much greater. Twenty-five years ago rates as high as 25 percent, 
were paid on mortgages of Western land, on what has proved to be ex- 



I20 The Industrial Progress of the Nation. 

cellent security. The rate now charged is seven per cent, and even 
less. 

This immense abundance of capital seeking investment, and the 
equalization of the rates of interest between the East and the West, 
may be attributed more to the railway service and to the reduction in 
freight charge than to any other single factor affecting the interest of 
capital. The whole country has become a close neighborhood, each 
part sustaining the other, so that the distribution of capital has be- 
come more and more uniform throughout the country, except in States 
whose public credit is still bad. So long as the public credit is bad in 
any community, the rate of interest on private capital will be very high. 

The effect of changes in the railway service is witnessed by the 
subsequent table. 

In considering this reduction in the charge on railways, it must be 
remembered that a very large portion of these railways built since 1865 
have taken the place of wagon roads, or of what are known in the West 
as " dirt roads," so that the saving to the people of the United States 
by the mere existence of the new roads, whatever they may charge, is 
much greater than the mere reduction of their charges since they came 
into existence ; but the latter saving is so big that any thing else may 
be disregarded. 

Reduced to the unit of the individual, the saving in the cost of rail- 
way service amounts to S13.67 per head of the population each year, 
or a fraction under ^60 a year for every family of 5 persons. This sum 
would have paid all the taxes which have been assessed throughout this 
period by the people of the United States for national. State, county, 
city, and town expenditures, including that part of the taxation which 
has been applied to the reduction of debts, whether national, state, or 
municipal. 

Or we may put this in another way. A sum, representing the sav- 
ing of the last four years only, as compared to the rates of 1865-68, 
would doubtless have sufficed to cover the cash cost of the construction 
of the 100,000 miles of new railway built between January i, 1865, 
and January i, 1887, at an average cost of $30,000 per mile. 

In a previous article in The Century it has been demonstrated that 
all our present crops, or products from land which is under the plow, 
omitting those which are derived from pasturage, have been derived 
from a little over 300,000 square miles of land. 

Now between the dates January i, 1865, and January i, 1887, more 
than 100,000 miles of railway have been constructed. If we lay out a 
strip of land only 5 miles in width, alongside each of these new lines, it 
would cover an area of 10 miles by 100,000, or 1,000,000 square miles of 
land, — three times as much as is now under the plow, of which every acre 
has been brought within less than five miles of a railway since the year 1 865 . 



Law Prices. High Wages, Small Profits. 1 2 1 

As this is one of the most important lines of investigation I venture 
to repeat certain tables which were printed in my report upon Bimetal- 
lism in Europe made in October, 1887, to the President of the United 
States (Executive Document, No. 34, Government Printing-Office). 
These tables bear witness to the paramount influence of the railway 
system of the country in enabling the government to resume specie 
payments and in reducing the price of food to consumers (pp. 122, 123, 
124). While these great price-making factors have been working out 
their just results in the United States, the charge for moving food across 
the sea by steamships has been reduced in almost as great a measure. 
The substitution of the screw for the side-wheel, the construction of 
large vessels made of steel, and the use of the compound engine of two 
cylinders, now supplemented by the triple compound, the opening 
of the Suez Canal, and other new forces applied to distribution, have 
altered all the conditions in Europe as well as in this country. 

Only a passing reference can be made in this article to other price- 
making factors. This department has been very fully treated in a recent 
pamphlet by Mr. Wm. Fowler, LL.B., whose article upon the alleged 
appreciation of gold, lately published by the Cobden Club, is one of 
the most satisfactory treatises yet issued. 

Among the other forces which have tended to reduce prices during 
the last twenty-years, is the Bessemer process for making steel, since 
supplemented by the " basic process," which latter process has brought 
the phosphoric iron mines of Germany into full production, previously 
almost useless ; the application of gas for fuel ; the use of natural gas 
for the same purposes in this country ; improvements in agriculture in 
the use of the buggy-plow, the gang-plow, etc., the self-binder attached 
to the reaper ; such improvements in all the textile arts that one opera- 
tive now performs all the textile work that could be done by two or 
more twenty-five years ago ; the improvements in the use of machine 
tools applied to all arcs ; and the like. 

In point of fact, it is not too much to say that one half as much 
capital as was required to do the general work of life in 1865 will now 
suffice to aid labor in compassing the same amount of product. That 
is to say, it took twice as many dollars' worth of capital to accomplish 
a given product twenty or twenty-five years since as is now needed. 

On the other hand, the owner of the capital is now compelled^ 
whether he will or not, to be satisfied with one half the income on each 
unit or dollar's worth of the present capital, if he trusts only to his 
capital for his means of living. 

Even in the matter of the use of gold, reference might be made to 
the economy brought about in banking and exchange ; the use of the 
telegraph and the like ; the saving of time in the transportation of com- 
modities ; all of which subjects are fully treated in Mr. Fowler's essay. 



122 



The Industrial Progress of the Nation. 







^ ^ (T) in in 

M IT) O "". CI 



H C? -f "> ^ "O 



H PI C) 



CO 

in 

O- 


rl- 

CO 


CO 


in 


in 
in 


in 




8^ 


-t- 

CO 


1^ 

H 


CO 


vO 
in 

0^ 


H 


l-l 


in 


CO 


M 


PI 


M 


O 


o 



N N CO CO CO 



vS w CO o q ^^ "7 i-L 

-F in I- ^" "i "5 ^ !d 

PI CO CO M :t S" r?^ f^ 

cf\ co' CO pr -f O "t ^ 



c<^ -t in O 



O ^ « vO O 



CO CO CO CO CO 



■H" ^^ ^2 '^^ -^ 'S ^ ^ ^ H ^2 '2 



^ OT CO CO CO CO CO 

CO CO CO CO 



Low Prices, High Wages, Small Profits. 



123 



O "Z. 'Si 



, 3 a> en 



.S s -^ 



i> X' S 



.2^52 

_c! O Ti 



c< c-i c, CI e< CI 



" a '/j iD -t CI CI -t 

CI^HWMl-IMMM 



:;, 8 

CI CI 



M 



p-l-O wO OC/DCOC/3 
CI c/j i^ 1/-) 10 l^ m o 
-tcOMCOu^vOOO 



Q 


-t 


1^ 


ir, 


,/-j 


.^ 


1^ 


\c, 


If, 


-t 


,^. 


^ 


M 


^ 


CI 


1^ 


iri 


1^ 


m 


i-~ 


\r, 


8 


fl 


CI 


f^ 


-t 


^ 


cc 


en 


fl 


t 


<Aj 


(fj 


vO 





t 


C 


m 





in 


1^ 


CI 


M 


m 


CI 


CT. 


CI 




C) 











-t 


fi 


M 


CI 


en 


CI 


<j 





f-l 


I^ 


tH 


-t 


-t 








1^ 





VJ 


'fi 


t 


CI 


«'". 


>-< 


M 


ti 



►- I'. O CT> •/"( fn Cj C) M 10 l-H CT^ 



C-' O CI CO 



-t d T- 0^ 



tri tr, ifi vO 



10 en m CO 



»>• CO w >o NO 

10 o -t •+ !->. r^ 

O M* fi' co" r^ ci' CO 

-t a* CT> in tn o 

1/"* en 1/"* o^ o vo 



-t-roi^coco C' o "-I 



•f 


H 


>o 





t^ 


I^ 


00 


C> 


CO 


■^ 





w 


M 


in 





?r 





r- 




en 


CI 


r^ 


CI 


a> 


en 


O) 





in 

























CO 

CO 


^ 


in 




>^ 






in 


en 

•0 


en 


CO 

-r 


-t 


en 


1^ 


CO 


CI 





cyj 





in 


en 



-t c/D O 



11 i-c >H i-i CI CI 



en en en 



in >0 I--. CO 0^^ O 
O O O 'O O !>• 
c/j CO CO '-0 CO cy^ 



M CI en -1- iri 'C i^ CO O* O " ci en -f 
t^ i^ j^ 1^ 1^ I- 1^ i^ r^ CO 'r> 'fi CO rrj 

ffj CO CO c/j <o rft rrj CO CO cyj c/j cO CO c/> 



124 



The Industrial Progress of the Nation. 



e s 



3j= 



o >, 



o 
c 


o 


rt 


r! 




o 






•o 


nl 


h» 














OJ 



e-g. 



3 ^ 



.COO 

.S '^ s 
2 ='" 

MOO 
■" -fl >- 

4) •* ^ 

rt J- T3 



rt *j w 
w. rt n 



£ w 



« S 



O t^ 00 O O 
vO O O vO ^ 



clTt-xnvO t-^oo O^O 



N en ^ XO 



r^ CO CO CO CO oo CO 
oococooococococooococococococooococooooo 



O -1- en -^ o_ 
w vo o CO m 



O M 



N vO O vO 

"Tf CO a^ M 



U-) o CO 



^ IT) O^ 01 



CO O in 



'J-cncn'^^in'O'O 



'^ o en o in en 



^ Tt- ^ vo vo 



rl- Tt- en 

in c> o 

c? o" r^ 

en CO o^ 

•* en r^ 



•4 "* 


en 


CO 


o" 


en 


r^ 


O 


1 in 


rf) 


m 


CO 


O 


V-i 


in 


> M 


-* 


m 


M 


'^ 


■^ 


vO 



in H en 



•^ in -Tl- CO '* 
in O vn O vO 



S m 



r^ CO M 



vo iH in in CO 
O in H CO r^ 
en O^ f^ in -^ 



M M en M 



O in c» 



Tt- in O 



eniH ocTico r^co X--VOCO 



Oinrf-vO enONCo 



CO CO O 



O r~. '^ O O O 
r^ o t^ CO o 



M O CO O 



Ocncneneno) f) m n ci 



en m" ^ m" en cT n" co" 



comDO r^oocovo 



in in vO O in en 



M o t~~ 00 00 O 



O O O t^ CO 



H H O en M CO O 



M O^ in 



in O O t~- O 



-^ O en OJ T|- vo 



OenM -^ininoa) r^ 
■ en r^ o en en r^ 



O en o^ , 



en"rJ-co -^^ eninoo 



en M CO 



r)-0^cooo 0>n-TtMCO w "^O 



^ O in W 



enf) c<i M en^'J-inininvn'O^ 



o^ r^ CO 



o r-» CO 

VO VO O O 



en'+ino r^co OO 



N en rf in 



r^ oo CO 00 00 00 00 

cocooocococococococococococooocooococooo 



Law Prices, High Wages, Small Profits. 



125 



Merchandise traffic of all the railways of the United States in 1885 ; authority, 
"" Poor's Railway Manual," 1886 : 

Tons moved 437,040,099 

Tons moved i mile 49,151,894,469 

Charge for service - $519,690,992 

Rate per ton per mile cents. . 1.057 

Twenty-seven trunk lines which, separately or in combination, centre in Chicago 
from the West, or connect Chicago with the Eastern seaboard : 

Tons moved 185,320,709 

Tons moved i mile 25, 125,076,247 

Charge for service $219,872,732 

Rate per ton per mile cents. . .875 

All other lines : 

Tons moved 251,719,390 

Tons moved i mile 24,026,818,222 

Charge for service $299,818,260 

Rate per ton per mile cents.. 1.248 

Measure of this service per head of population and per family : 



Lines. 



Tons per . I Charge Charge per 

person JJistance j -g,. pg^_ family of 
hauled. I *■ ^^^ , five persons. 



person 
per year 



Twenty-seven trunk lines. 
All others 





Miles. 


i 




3-252 


136 i 


$3.68 


$18.40 


4-420 1 


95i 1 


5.26 


26.30 



Total. 



7.672 



lli| 
Average. 



•94 ! 



$44-70 



The average charge per ton per mile on the 27 trunk lines in the years 1865 to 1868, 
inclusive, exceeded that of 1885 by 1.635 cents. At this rate of excess, applied to the 
whole traffic of the United States, all other lines having made a greater reduction, 
so far as the data can be had the sum saved in the year 1885 was $803,633,477. 

The whole service of all the railroads in 1885 consisted in moving 42 pounds a day 
-of food, fuel, fibres, and fabrics, a distance of 11 1 J miles for each man, woman, and 
child of the population, or 1,470 pounds a week for a family of five. The average 
charge to each person was a fraction under i\ cents per day, or 87^^ cents per week 
for each family of five. 

The 27 trunk lines treated in the foregoing tables perform about 
one half the freight sen'ice of the United States. The average 
charge per ton per mile on those lines, 1866 to 1873, inclusive, 

was 2.315 cents per ton. 

1874 to 1885 1. 196 



Difference .... 1.119 " " 

Had the actual traffic of those lines from 1874 to 1885 been charged 
the difference, the amount of such additional charge would have 

been over $1,756,000,000 

The excess of exports over imports in this same period was $1,574,021,528 

It thus appears that the reduction in the railway charge taken by itself without 
regard to other reductions in the cost of production and distribution, sufficed to enable 
this countrj- to resume specie payment in 1879. 

In fact, if all the changes which have been worked by the elimina- 
tion of time and distance from the conduct of affairs were to be consid- 
ered, it would require a volume instead of an article to picture them. 



1 26 The Industrial Progress of the Nation. 

It thus appears that, while the purchasing power of a day's or a. 
year's labor has increased since i860 from 40 to 70 percent, according 
to the grade or skill of the workman, and from 66 to 108 per cent, since 
1865, and while the earning power of capital, considered without regard 
to the skill of its owner, has diminished absolutely one half and rela- 
tively at least 75 per cent, since i860, there have yet been periods when 
it has been difficult for many workmen to find work, when also capital 
could not find employment, and when there was want in the midst of 
abundance. 

Can these faults in the present forms and methods of society be 
remedied by legislation, by cooperation, by profit-sharing, or by the 
state assuming more and more the control and direction of the forces 
of capital ? These are questions which demand an answer. 

That there has been grave discontent on the part of labor, and a want 
of that true comprehension of what may rightly be called " the claims of 
labor " on the part of many capitalists, may not be denied. 

What are some of the causes of this discontent, and how shall 
admitted wrongs be righted ? 

It is a matter of common knowledge that the application of machin- 
ery in special arts often causes the displacement of the craftsman, the 
hand-worker, or the common laborer who has been trained in that art, 
and who finds it difficult to adjust himself to new conditions. This, 
fact, which has been a matter of common observation in single arts, has 
affected nearly all the arts of life in the last twenty-five years more pro- 
foundly than ever before. There have been single great inventions, 
like the application of steam, which have gravely altered the conditions 
of society ; but there have probably never been so many applications of 
science and invention to the common arts of life as have been applied 
in the present generation, nor has any single one ever been so potent in 
modifying and changing all the conditions of society as the sinking of 
time and distance in the fraction of a cent a ton on a mile of railway. 

In this country, where these great new forces have been more free 
to act than in any other, there are certain facts which must be admitted 
by every one competent to observe. Leaving wholly out of view the 
transfer of property already saved from one person to another in the 
gambling operations of the stock exchange, such incidents being of na 
material consequence except to those who engage in them, we may 
observe : 

First. That the direction and use of capital are becoming more 
and more a matter of scientific training, as the margin of profit in every 
art comes to a less and less fraction of the product made or distributed. 
The merchant adventurer has gone the same way with the craftsman 
and his apprentice — he has disappeared with the removal of the mys- 
teries of trade. 



Low Prices, High Wages, Small Profits. 127 

Second. Although great fortunes have become more conspicuous, 
their number is very small, and their aggregate amount is yet smaller 
in proportion to the amount and great number of moderate fortunes 
which are not conspicuous but which are steadily increasing. 

Third. Adjacent to every city are suburbs or neighboring towns 
which are filled with comfortable dwellings of moderate size, which 
give evidence of comfort and welfare steadily increasing on the part of 
an increasing portion of those who perform the practical work of the 
country. These are the dwelling-places of their respective owners or 
occupants, who are not capitalists in any sense, but who have assured 
to themselves an abundant subsistence, a home, and a safe position in 
the community. 

Fourth. While great bonanza farms are conspicuous, they are also 
few in number ; the increase in small farms is very rapid ; and perhaps 
the increase has been yet more rapid compared to what it had been 
before agricultural machinery, science, and invention had come nearer 
to the farm. 

Fifth. By comparison with this rapid progress not only of those 
who are in a position of wealth, but of the vast number who, although 
not making great savings, are living year by year more comfortably, 
better housed, better clothed, and better fed, the bad condition of the 
very poor, and the more uncertain position of the common laborer 
whose opportunity for work is intermittent, becomes more apparent 
and therefore demands urgent attention. 

If such are the facts which are disclosed by the actual observation 
of the conditions of men, and confirmed by the deductions drawn from 
them in this and other cities, do we not find in the very gain in the 
purchasing power of wages a cause of an increasing disparity in the 
conditions of those who class themselves as " working people," in a 
limited sense ? and may not this be one of the grave causes of discon- 
tent, even though all have made some progress ? Is it not apparent that 
while the very poor are proportionately no more numerous, and the 
ratio of common laborers to others is no greater, yet within the lives of 
men who are not yet beyond middle age, great numbers among the 
workmen themselves have seen those who started on nearly the same 
plane, and who in 1S60 could earn but little more than their fellows, 
yet in 1885 and 'Zd, raised far above them in their condition, although 
still classed as fellow-workmen ? 

To him who has had the capacity, either mental, mechanical, or 
manual, to take advantage of the opportunity afforded by science and 
invention, has been given the greatest progress ; while from him who 
has not the mental or manual aptitude to adjust himself to the new 
conditions, has been taken even the opportunity for common labor 
which he enjoyed before. 



128 The Industrial Progress of the Nation. 

Do we not witness in the various organizations of labor, so called, 
:an attempt to equalize this growing disparity ? It is often claimed that 
" equal work is entitled to equal pay " ; but the difference in the 
quality of the work may not be overlooked. The attempt is made to 
control the hours of labor by various artificial methods. In respect to 
minors, and possibly in respect to women so long as they do not vote, 
such laws may be necessary. Other attempts are made by establishing 
stated lists of prices, by limiting the quantity of work to that done by 
any one man, by limiting the number of apprentices, and by other 
similar methods, to equalize the material conditions of men. But all 
these efforts fail wholly or partly.- An equal quantity of work meas- 
ured only by the time devoted to it or by the actual amount of work 
required in it, never has and never will secure equal results. It is not 
in the nature of things. It is the efficiency of labor that tells, not the 
quantity or time. One man will waste more leather in a given time by 
want of aptitude or skill in its use than another man will convert into 
good and useful boots and shoes. Profit may be defined as the margin 
which mind gains over muscle. This is as true of the higher gain in 
skilful work when done by the piece as in the use of capital already 
saved. 

The result of all these artificial methods to control conditions which 
rest upon individual capacity, when even partly enforced, is to level 
down the earnings of the industrious and the capable to the plane of 
the unskilful or lazy. 

When this truth dawns upon the mind of the discontented, then the 
trade organization or association soon changes its course and be'gins to 
promote the development of individual capacity ; it becomes a common 
school in social science ; its members soon find out what a really 
beneficent force may be developed by organizing labor. 

I have endeavored to present the great price-making forces which 
have been evolving progress from poverty during the present genera- 
tion, and I may again repeat what I have often had occasion to state. 
The necessary conclusions to which we are led are : 

Fiist. When organized capital is placed at the service of labor, it be- 
cojnes more and more effective, while in amount it diminishes in ratio 
to product. It therefore secures to its own use a diminishing portion 
of, or profit from, an increasing "product. This is the economic law, 
so called, of diminishing profits. 

Second. Organized labor, when each member is left free to avail him- 
self of every opportunity which capital, science, and invention place 
at his disposal, secures to itself an increasing share of an increasing 
product or its equivalent in money. 

Third. As capital and labor become more under the control of 
•common intelligence they cannot help becoming more closely allied ; 



Low Prices, High Wages, Small Profits. 129 

tinder these conditions high wages or large earnings in money, or in 
what money will buy, become the necessary result or reflex of the low 
cost of production. 

Fourth. A low cost of production accompanied by high wages is 
most fully assured by the application of science and invention to all 
the arts of production and distribution. Pauper labor so called, may 
be dreaded only by those who possess pauper intelligence. The com- 
petition which is really to be courted and emulated is that which is 
represented by the art schools of France, the weaving schools and the 
like of Germany, the trade schools and the industrial schools which 
have spread more rapidly in England in recent years than they have 
in this country. Skill and intelligence, free from the burden of stand- 
ing armies and of war taxes, may command the commerce of the 
world. 

The present population of the globe is computed at about 1,400,- 
000,000 ; of these only about 400,000,000 belong to what may be called 
the machine-using nations. One billion do their work by hand, or by 
the use of rude tools guided by the hand. 

In a peaceful contest for commerce with these nations, who will 
win ? Certainly that nation will not win which obstructs the import of 
the crude products which are all that these non-machine-using nations 
can give in exchange for what they need, by imposing heavy taxes 
upon such products when they enter the ports of our country. 

But when all has been accomplished which can be done by law or 
by association, or by the repeal of obstructive acts, there will still re- 
main x;entres of pauperism in our cities ; they exist mainly among those 
of foreign birth who cannot adjust themselves to the new conditions to 
which they are subjected. There will also continue to be periods 
when common laborers will find it difficult to obtain work. How shall 
we meet these admitted faults ? Is there any other way than by adapt- 
ing the methods of common-school education more nearly to the 
necessities of life ? If it is true that one cannot permanently help 
either men or women who cannot help themselves, is it not equally true 
that classes in society in considerable numbers cannot be raised from 
a state of dependence upon others, except by the development of each 
member of such class to a knowledge of some art by which he can sus- 
tain himself, even if it be only a training in the application of the hand 
itself to useful work ? 

Nine tenths of the occupations of the people of this country in point 
of number still depend upon the individual capacity, the mental 
development, the mechanical aptitude, or the manual dexterity of each 
person. Only one in ten is occupied in a great factory where the con- 
duct of the work depends upon the minute subdivision of labo-r. 

Does not this fact bear witness to the necessity of promoting the 
Q 



1 30 The Industrial Progress of the Nation. 

development of the individual in order that common welfare may be 
attained by every man, woman, and child in the community ? 

What can the state do for its citizens in helping them to obtain sub- 
sistence, if the people who constitute the state are themselves in- 
capable of sustaining their own families under present conditions ? 

Neither the state nor the nation possesses property. The state only 
controls the property of its citizens by right of eminent domain. It 
can take property under the due process of law for public use, with 
compensation to him who owns it. It can tax all property in order to 
maintain governments. It may tax all property in order to perform 
certain useful functions which, by common consent, the state can per- 
form in its corporate capacity better than the citizens can in their 
individual capacity. But the state as state has no productive power^ 
and it is upon the annual product that all depend alike. 

In this country at the present time there is and can be no lack of 
most abundant product. We waste every year enough to sustain 
another nation half as numerous, if not equal in number. The mech- 
anism of distribution is more than ample ; yet there is want in the 
midst of plenty. 

Progress from poverty is the common rule. ** Progress and'^ovtxX.y " 
is the marked exception, conspicuous and dangerous. In one sense 
every man is his brother's keeper. If he neglects his duty and cares 
not for his neighbor, the tax-gatherer, at least, will find him out and 
will compel him to do at the greatest cost what perhaps he might have 
accomplished at the least cost, had he himself realized his own respon- 
sibility. 

There is one thing no man can invent, and that is a form of society 
in which the rights, whether of the rich or of the poor, shall not be 
accompanied by corresponding duties. He who treats these economic 
problems without taking the moral and ethical side of life into consid- 
eration may rightly be called a representative of " a dismal science. "^ 
But it by no means follows that we must seek to reconstruct humanity 
in our effort to form society. The subject of economic science is man 
as he now is, with all his faults, his selfishness, and his failings. It 
was said of old time that " surely the wrath of man shall praise thee." 
Might not the prophet of the present affirm with equal insight : " The 
power which makes for righteousness compels not only the enlightened 
self-interest of man, but his very selfishness, to work out the progress 
of humanity ? " 

The commerce of the world now turns from one side of the globe 
to the other on a margin of a cent on a bushel of grain, a dollar a ton 
of metal, a quarter of a cent a yard on a textile fabric, or the sixteenth 
of a cent a pound on sugar. The cube of coal, as I have before stated, 
which would pass through the rim of a quarter of a dollar, when used 



Low Prices, High Wages, Small Pro/its. 131 

in connection with the compound engine, will drive a ton of food and 
its proportion of the steamship two miles on its way from the producer 
to the consumer ; by the invention of the triple compound, one fourth 
even of this fuel has been saved. 

The profit or loss of this great nation turns on the price of a daily 
glass of lager beer. 

When this article is read, five cents a day, more or less, to each in- 
habitant of the country, will represent $1,095,000,000 worth of prod- 
uct, which may be either saved or wasted according to the measure 
of the intelligence of each person. The profit which might be repre- 
sented by this sum of money may be diminished one half by the igno- 
rance of legislators who take no cognizance of the facts of life when 
framing the statutes by which they undertake to regulate and control 
an organism which yet makes its way steadily onward with greater or 
less effort, whatever may be the system of laws by which its progress is 
either helped or hindered. 

These computations are submitted for what they are worth. They 
are probably as near to the facts as it would be in the power of any 
private student to bring them, whose opportunity for study or for 
treating these questions is very limited. 

In the attempt to comprehend the laws of social science by reading 
and studying treatises upon political economy, the writer long since 
met the difficulty which would be apt to occur to a business man, — to 
wit, the necessity for a statement of accounts and a trial balance. In 
the attempt to make such a statement and to balance the accounts of 
one class with another, and of one branch of industry with another, he 
has himself come to certain conclusions which coincide very closely 
with the modern teaching of political science. 

The science of life does not consist in laissez /aire, or letting alone. 
There are many objects which may be better attained by the state, 
town, or city undertaking them than they could if left to individual or 
corporate enterprise. There are many others which it is often pro- 
posed to have the state assume, which are utterly beyond the functions 
of the state in its corporate capacity to manage. 

Among the prime factors which make or mar material prosperity 
there are grave differences. The conclusion of the writer is, like that 
of all the economists whose works have any standing among men, that 
tampering with, or debasing the standard of value is the most malig- 
nant fraud which the government can perpetrate. The cost of substitut- 
ing paper notes for true money under the stress of war added without 
question to the cost of the civil war as much as the whole sum of out- 
standing debt yet unpaid. The most beneficent factor in the lowering 
of prices and in raising wages has been the extension of the railway 
system and the reduction in the charge for the service. Vanderbilt 



132 



The Industrial Progress of the Nation. 



was the typical railroad man of his day; he was also the great com- 
munist of his time, because he reduced the cost of removing a barrel 
of flour ;i, thousand miles to so small a sum that it can hardly be meas- 
ured ill a loaf of bread, at a margin of profit to himself and his asso- 
ciates which is now less than the value of the empty barrel at the end 
of the line. The heavy taxes which we are now i;aying are but a slight 
burden upon the peoi)le ; so long as they can be applied to the pay- 
ment of the public deht, ihcy may be justified, however unscientifically 
and injudiciously the acts for collecting them may be framed. 

EXAMPLICS OK UlCOUCTIONS IN PKICR— KEnUCTION IN COST OF LABOR— RISE 

IN RATK OK WAOKS AND INCRICASK IN PUK(;HASING POWKR OF WAGES. 

S'l'ANDAKiJ Cotton Siiiiit'i'iNO. 



Year. 

i860 
1865 
1870 

1875 
18S0 
1885 



Year. 

J 860 
1865 
1870 

1875 
1880 



Price per 
y;irfl. 



8.17 ClH. 
50.61 " 

I4-33 " 
9-79 " 
7.4'-> " 



I'ricc" per 
Kuit. 



Contof labor 
per yard. 



(J. 095 cts. 
1.501 " 

1.425 " 

1.314 " 

0.093 " 

0.095 " 



Earnirifz* 
per year. 

$207.00 
234.00 
275.00 
280.00 
260. f JO 
284.00 



PurchuHinff power in food, cloth, and fuel. 



66,j 
420 
632 
721 
782 
1 014 



Suit qv Furnitukb pok a Bbdhoom. 



te5-'"> 

55-<J" 
33- 00 
28.00 
20.00 



CoHt of labor 


Kaniiii({«. 

$456. 0(J 


$12.00 


rH.oo 


678.00 


1 1.00 


6B7.00 


10.00 


723,00 


8.00 


723.00 



Piirchaving power in food, cloth, and fuel. 



'473 
121 '/ 

t57« 
1 868 

2175 





OnK DoZKN S'J'BItL 


Axiw, Day Wagk, Rations Fo(^ij onlv I'KK Day. 


Vciir. 


Price. 


CoKt of labor 


Day's 

wage. 


RationH f 


.O.I only. 


i860 
1865 
1870 

1875 
1880 


|ri.oo 

20.50 

14.50 

11.50 

8.50 


$2.28 
3. 12 

2.93 
2.46 
2.04 


$1.70 
2.27 

2.35 
2.17 
2.26 


6.25 

5-39 
6.41 
6,00 
8,76 













In thlD example the priceK of foot! in \hi: s.-ime coiiuLy liuve bocii computed ait'a Htandard, 



A lloi<HE-UAKK, 



Year. 


I'ricr. 


Cf.stof l;,l)or 


Day's 


Rations 


1B65 


$3S-"o 


$3.3''' 


$'.93 


4-53 


1870 


32.(JO 


2.87 


2.12 


5-54 


1875 


28.00 


2-53 


1 . 90 


5-92 


iHKo 


24.00 


2.10 


1.76 


7.01 



(!()iMi)ilc(l from Vol. XX. U. S. CcnmiH by Joseph JJ. WcuUs ; computed Ijy Edward Atkinson, 
and verified by compariHori with other uiithoritieK. 

Couhl Hpacc lie HiJ.'ired, examples of the .same kind could be added from almoHt every indus- 
try to wliieli modern machinery has been applied, but theHC must suffice. 



Low Prices, fli^h Wages, Small Profits. \ 33 

Whatever may be the opinions or theories of each reader upon 
these various problems upon which every voter in a free country must 
pass whether he will or no, it is held that there can be no true solution 
unless it is based upon facts. It has been the purpose of the writer in 
this series of Century articles to give these facts rather than to present his 
own theories ; to ask questions rather than to attempt to answer them. 

It may be suitable to submit a very few examples, which will be 
found on the preceding page, proving how the rule of diminishing prices, 
decreasing profits, and diminishing cost of labor has been consistent 
with the general rise in the rates of wages and in their purchasing power. 
This principle would of necessity be deduced from all the tables which 
have already been submitted ; but a few specific examples may be a mat- 
ter of curious interest, and will fully sustain it. 



THE DISTRIBUTION OF PRODUCTS 



THE DISTRIBUTION OF PRODUCTS. 



I. 

HOW CAN WAGES BE INCREASED?' 

AS my book upon " The Distribution of Products," which consists 
mainly of an essay on " What Makes the Rate of Wages ? " 
is now passing to its fourth edition, and is attaining a wide circulation, 
I am very glad to find it reviewed by Mr. Frederick B. Hawley, in 
the Quarterly '^oiirtial of Economics for April, 1888, published for 
Harvard University. If there are any important errors either in the 
theory or in the figures which are presented in this essay, I greatly de- 
sire to correct them. From this review and from some previous notices 
of the book I have been led to believe that I have not made the rea- 
sons for my conclusions as plain as I might have ; I therefore beg to 
repeat the main propositions which I have attempted to sustain, and 
to give more conclusive proofs, if I may do so, that these propositions 
are correct. 

The fundamental idea of the book is as follows : the annual prod- 
uct, or the product of each series of four seasons, is, and must be in 
the nature of things, the source of all rents, profits, interest, wages^ 
salaries, and earnings. This product is the result of the joint appli- 
cation of labor and capital. It therefore follows : 

I. That in this product, or in its distribution or consumption, all 
persons take some part who are engaged in gainful occupations, num- 
bering in the census of 1880 a fraction less than one in three of the 
population, and listed under the respective heads of professional and 
personal service, trade and transportation, manufacturing, mechanical, 
and mining pursuits, and agriculture. By far the larger proportion of 
each of these classes is now, and must continue to be, either in the po- 
sition of small farmers, who work harder than their hired men and who 
outnumber the hired men engaged in agriculture, or of wage-earners, 
or of persons who are in receipt of small salaries ; nearly all, with the 
exception of the farmers, are in the position of the employed rather 
than of the employer. The gains or savings of these working classes, 
which may be added to the capital of the country, amount to a large 
' Reprinted from the Forum. 
137 



138 The Industrial Progress of the Nation. 

sum in the aggregate ; but, with few exceptions, they are small in 
amount in each individual case. The lives of the great majority are 
mainly spent in getting a living. 

2. These " working classes," so called, constituting by far the great- 
est proportion of all who are occupied for gain, now secure for their 
own use and consumption substantially ninety per cent, of the total 
annual product of this country ; consequently, that part of the annual 
product which is, or can be, in an average year, secured by capital for 
its service, whether the capital be owned by the rich, the well-to-do, 
or in part by the wage-earners themselves, cannot exceed ten per 
cent, on the average. This is the increment which can be set aside 
for the maintenance and increase of the capital of the nation. 

3. The working classes, making use of that term not in the broader 
but in the narrowest sense in which it is customarily applied, have 
been, and are still, securing, for their own use and enjoyment, for con- 
sumption or savings, decade by decade, subject to temporary fluctua- 
tions in each ten years, an increasing share of a constantly increasing 
product or its equivalent in money, and will continue to do so as long 
as the competitive system is the rule in commerce, in production, and 
in distribution. 

4. Under the relatively free conditions of society in this country 
as compared to all others, the members of the three classes, /. e., the 
so-called working classes, the well-to-do, and the rich, are constantly 
changing in their respective conditions. On the one hand, the pros- 
perous classes are constantly receiving recruits from the working class ; 
on the other hand, as has been well said, " it is rarely more than three 
generations from shirt-sleeves to shirt-sleeves." 

No one could have been more surprised than myself when these 
conclusions developed themselves from the facts of life. I have but 
little time for the reading of books, and I am not aware that the attempt 
has been made by any one else to measure the proportions which may 
be assigned to each class in the community by first computing the sub- 
ject of the division, i. e., the annual product at its final measure in 
money when disposed of for final consumption. It may be that this 
method is one which cannot be applied with sufficient certainty to 
justify the conclusion ; of that each one must judge for himself as my 
processes are developed. 

Many exceptions have been taken to these proportions in the divi- 
sion of the annual product, but they have usually been, on the whole, 
of a somewhat superficial character, like the review to which I now 
propose to make a rejoinder ; they assume that I have intended to 
state that the proportion of the annual product which falls in the first 
process of distribution to capitalists, landlords, manufacturers, and 
men of business, in the form of rents, profits, or interest, is the same 



How Caji Wages be Increased ? 139 

in amount and proportion as that which constitutes the net profit or 
savings of the nation as a whole, which can be appHed to the main- 
tenance or increase of the capital of the nation. I am probably my- 
self responsible for this confusion of thought, by my want of clearness 
and precision in the preparation of a treatise which was dictated in 
the intervals of a very busy life, and published without that careful 
revision which was due to the importance of the question which I have 
treated under the title, " What Makes the Rate of Wages ? " I may 
not have discriminated sufficiently between the income of individuals 
and the net profit or savings of the nation. I therefore take the op- 
portunity offered me by my critic to present anew some of the reasons 
which led me to the conclusions given as to the relative shares of labor 
and capital in the aruiual product. 

On one point I fully agree, to wit : if the workmen or laborers, or 
if the classes consisting of laborers, receivers of small salaries, small 
farmers, and the like, who now constitute the great majority of the 
community, do now actually obtain for their own use and consumption 
ninety per cent, of the gross annual product, then there is little mar- 
gin for improvement in their condition except through an increase of 
the product itself. Or if, as the reviewer says, 

" the complete success of co-operation combined with nationalization of land or with 
the establishment of an ideally perfect system of socialism would augment laborers' 
incomes within the limit of only eleven per cent. , and that only provided as much 
were produced under the new conditions as under the old, then such a percentage of 
gain would be wholly insufficient to raise the recipients' wages to any condition mate- 
rially superior to their present one." 

That is the very conclusion to which my own mind has been 
brought by my special investigations and by the observation of some 
curious facts. For instance, in a recent strike, in which a very large 
number of men were engaged in a special employment whose earnings 
averaged $500 a year, I found that, had they secured for their own enjoy- 
ment the entire profit of the business at the time of the strike, it would 
have increased their wages but five per cent, or $25 per year. It was 
an art in which the capital required was very small in proportion to 
the annual product. The strike failed, and the business continued as 
before. 

The reviewer alleges that the proposition that ninety per cent, of 
the product is gained by those who do the work of life, and only ten 
per cent, goes to capital, " is so evidently false as to constitute a re- 
ductio ad absurdum." If he would enter upon the line of investigation 
which I have followed, without any a priori conceptions or prejudices 
in his own mind, he might be more successful in attempting to analyze 
the figures on which my conclusions have been based ; until then it 
would be prudent to repress such dogmatic conclusions as the above. 



1 40 The Industrial Progress of the Nation. 

There are two sorts of discontent among working people, either of 
which may be promoted by a discussion of economic questions ; one 
kind is wholesome, the other is baneful. If my conclusions can be 
proved, a wholesome discontent with the admittedly narrow conditions 
of life may be directed to the promotion of greater abundance, higher 
wages, shorter hours of work, and bettei* conditions of life. Such 
progress can be brought about only by hearty co-operation between 
workmen and their employers or between labor and capital, and, in my 
judgment, only under the competitive system. If, on the other hand, 
the reviewer is right in alleging that capital is grasping a share of the 
aniiual product to which it is not entitled in compensation for any" 
service rendered, then the discontent of the workmen may take a dan- 
gerous, violent, and disastrous direction. It is this conception which 
promotes strikes. 

If, then, ray conclusions are based on facts, and the view which is 
held by my critic and others who have attempted to break the force of 
my figures is wrong, but is yet presented under the guise of truth, a 
very great responsibility rests upon him and his coajdjutors who speak 
without knowledge and with more zeal than discretion, thus aggravating 
the very evils v^hich they undertake to remove. 

I will first consider the basis of my estimates. My critic's first error 
is as follows : he cites a copy of one of my tables, in which the com- 
mercial product of the United States, or that part of the product which 
was bought, sold, and exchanged in the year 1880, was estimated at 
$9,000,000,000 worth. He says : " This commercial product is esti- 
mated by Mr. Atkinson from the census returns " ; and he adds : " It 
is a difficult matter to reach a true result from these census figures, as 
in these returns many values are found twice or more." I (iid not de- 
rive my estimate of the commercial product from the census returns, as 
any one may see who uses common care and discretion in reviewing 
my treatise. On page 31 of my book these words appear : 

' ' The writer had reached his own conclusions by very different methods from those 
used in the census department, and he had satisfied himself that if there be added to 
that part of the annual product which is sold, and which is therefore reduced to terms 
of price in money in the markets of the world, for domestic consumption upon farms, 
and in factories $1,000,000,000, then the total value of the annual product would not 
exceed $10,000,000,000 in the census year at the retail price for final consumption." 

This comes to about two hundred dollars' worth of product per 
capita, including the domestic consumption of farmers and others,, 
which does not enter into the commercial product. 

I have given iri my book the same reason which is cited by my 
critic for not making use of census figures except as a means of check- 
ing the estimates arrived at by entirely different methods. Whatever 
errors, however, my critic may have made in misrepresenting my 



How Can Wages be Increased? 141 

method, he yet reaches the conclusion that my estimate of ninety per 
cent, of the commercial product of $9,000,000,000, to wit, $8,100,000,- 
000, was the wage and salary fund of the United States in 1880. " Al- 
though wrongly arrived at," he says, " it must be nearly correct." He 
does not give his own method of reaching concurrence of opinion on 
the subject ; it is therefore impossible for me to say whether his results 
were wrongly arrived at or not ; suffice it that on this point we agree. 
The point of difference between us is as to the sum remaining over this 
wage and salary fund, which passes to capitalists and property owners, 
to be added to the capital of the nation. I computed this at ten per 
cent, of the entire product, or at %2o per capita of the population, on an 
average product of $200 worth of all commodities in a normal year, 
such as the year 1880 happened to be. The rate of accumulation may 
possibly yield a somewhat larger sum in a year of great prosperity, and 
doubtless diminishes to a less sum in years of adversity. The basis of 
computation in 1880 was made upon the assumed product of 50,000,- 
000 people, of whom about one in three was occupied in gainful work 
of some kind ; with an increase of population the average sum of the 
product and the average amount added to capital may increase, while 
the proportion /^r capita may not vary. 

In attempting to prove that I am in error in this, my critic alleges 
that "there were in the census year 4,074,238 working people engaged 
in rendering personal and professional service, the value of whose 
labor does not appear in the value of any material production." He 
then assumes that these four million persons sell their service at an 
average of $300 per year each ; " therefore," he says, " this would leave 
a sum for personal service amounting to $1,200,000,000, to be added to 
the gross value of the material product." He next makes a hypo- 
thetical estimate as follows : 

" Horses and other animals, hired or kept for pleasure ; railways and telegraph com- 
panies, to the extent to which they are utilized for other than business purposes, 
together with service performed for us by various other forms of accumulated wealth, 
which would probably add enough to this sum to make it, in round figures, $800,- 
000,000. Adding this to the computed value of persons engaged in personal and pro- 
fessional service, we have $2,000,000,000 of annual income which Mr. Atkinson fails to 
account for." 

This passage is very obscure, but it is the turning-point of the 
whole question. If I catch the meaning of the reviewer, he finds 
$2,000,000,000 worth of service rendered by professional men, by do- 
mestic servants, by men of wealth and others, also by horses used for 
pleasure, by railways when not occupied for business purposes, which, 
as he says, "have no material basis." If they had no material basis, 
from what source was the money derived ? He proposes to add the 
value of these services to a sum of products already established, and 



142 The Industrial Progress of the Nation. 

having thus added $2,000,000,000, he assigns that additional amount to 
profits or to the capitalists as an addition to their proportion of the 
total product as computed by me. This method would warrant a very 
queer conclusion, which might be given in the following terms : 
Uncle Sam gets $10,000 a year out of his estate ; he spends $9,000 a 
year, and saves 10 per cent, or $1,000 worth of his product. " Oh, no," 
says the objector ; " that is not a fair statement of his savings. Uncle 
Sam has five servants in his employ, whose services are worth $300 a 
year each ; there must, therefore, be added $1,500 to the $10,000. His 
true income is $11,500, and he makes $2,500 a year above what he 
sfjends ; it is too much ; he ought not to have so much." One would 
like to learn the secret of how to make a profit from the services of 
servants, from driving pleasure horses, and from riding in palace cars. 
Now, the very proposition which I have attempted to sustain is, that the 
entire production of the census year could not have exceeded in value 
$200 worth /^r capita on the average of population, including the very 
classes whose earnings he proposes to add. From that part of the pro- 
duction, whatever it may be, which enters into commerce, computed by 
me at 90 per cent, of the whole, all wages, all taxes, al'l profits, and the 
compensation for all services or earnings must be derived, including 
the payment made for professional and personal service and the 
service of wealth as well — unless the capital previously accumuiated in 
other years enters into consumption in a given year without being re- 
produced, which would, of course, be disastrous. 

In my computation the sum of $8,100,000,000 is given as the wage 
and salary fund, the compensation of the small farmer, and the share 
of those who may be called the hard-working classes in the community 
in the year 1880 ; this being divided by the number, yielded an aver- 
age to which my critic assents. In my further computation, the do- 
mestic consumption of the farmers is estimated at $1,000,000,000, and 
the share of the product assigned to the maintenance and increase of 
capital is put at 10 per cent, of the whole. If, then, this last assign- 
ment is underestimated, an additional product must be found before 
it can be increased. In other words, my critic must prove conclu- 
sively that I have omitted 20 per cent, of the total product in my 
computation before he can contest the sums assigned to each specific 
class of population or justify his own figures. I have always hoped that 
some thoroughly competent student would take up this line of investi- 
gation, as it seems to me fundamental. I am aware that my own work 
is insufficient, but I can find no evidence of product exceeding $2oa 
worth /^r capita, or of an increment to capital exceeding 10 per cent, of 
that average. 

My critic and others who have contested these figures have not 
made this complete investigation. He himself sets up a mass of 



Hon.' Ca?i Wages be hici'eased ? 143 

figures, which are his own, and then bases a criticism of my results on 
his own guesses at the sum of the products. In this he is like many 
other teachers and preachers whose zeal is greater than their knowledge, 
and who may do more harm in promoting discontent of a malignant 
kind the more sincere they are in their convictions. 

The fundamental principle which I have endeavored to present in 
the treatment of ' What Makes the Rate of Wages ? " is this : the 
fixed capital, so called, must, of course, be carried over, increasing 
from year to year with the population, in order that it may be made 
use of in co-operation with labor in the production of the wage, 
salary, and profit fund of the year, to wit, the total product. A small 
portion of each year's product, commonly called quick or active 
capital, is also carried forward, to be immediately consumed or ex- 
pended in the next year to start upon, as a small portion will be car- 
ried forward to the subsequent j^ear to start the work of that year 
upon ; the remainder of the product, whatever it ma\" be worth, is 
the only source of all profits, income, wages, and taxes in that series 
of four seasons. There is, and can be, no other soure of revenue to 
any one, unless the fixed capital previously saved be converted into a 
consumable form and impaired in a bad year. I have reached the 
somewhat appalling conclusion that this total product does not yield 
to each person of the population, now or in 1880, more than what 
fifty to fifty-five cents a day will purchase, including not only the 
commercial product, but the product consumed upon the farms. 
Therefore, by so much as some have more must others have less. How 
can the haves justify themselves to the have-nots? The method by 
which this conclusion has been reached is described in the book, and 
the statement of the method should have rendered it impossible for 
my critic to have put his exceptions to the work in the form in which 
he has presented them. He has not read the book with the care which 
is due from a reviewer who has a serious purpose in view. It would be 
entirely free to him or to any one else to reject the whole treatise as 
unworthy of criticism ; but, in the line of economic investigation, 
whoever undertakes to review either figures or the conclusions which 
are based upon them, should at least qualify himself to present the 
subject of the review itself consistently and correctly. 

If this theon.- is a true one, to wit, that all wages, profits, and taxes 
which are liquidated in money must of necessity come within the limit 
of the salable value of that part of the product which is bought and 
sold, it follows of necessity that " neither the earnings of those per- 
sons who are engaged in personal and professional service, nor the 
support of horses, railways, and telegraph companies used for other 
than business purposes, nor the sendees performed for us by various 
forms of accumulated wealth " can be added to a sum which already 



144 ^^^ Industrial Progress of the Nation. 

covers the entire value of every thing produced. The whole ques- 
tion, therefore, is, Did the commercial value of the annual product of 
1880 exceed $9,000,000,000, or %\%o per capita oi the population — 
^20 being added for consumption on farms — or does it exceed $200 
worth /^r capita now ? 

The family group numbers five, but one in three is at work. Is the 
average income or product of all at work, rich and poor alike, worth 
only $600 a year, to be distributed as wages, profits, and taxes at the 
present time ? 

I reached that estimate by the following method : 

1. I computed the wheat crop in quantity by bushels ; I then found 
the value of the wheat exported ; I next converted the remainder into 
bread, and priced it at the average market price of bread, taking an aver- 
age rather than a maximum ; I computed the corn crop and its product 
in meat and dairy products at retail prices. I treated all food-products. 

2. I made a careful analysis of all the fibres produced and im- 
ported, computed their value, and being familiar with the cost of 
manufacturing both fabrics and and clothing, carpets, cordage, and 
the like, I converted the crude materials into their final value at the 
retail prices at which these commodities were sold. 

3. I went through the same process with metals, timber, and other 
commodities, and footed up the result. Of course I could reach only 
approximately correct results ; but having reached the total. amount of 
the probable value of these products at retail prices in this way, I 
then reversed my method, and proceeded from the expenditure of the 
individual to the gross sum of their expenditure. 

I took large averages of consumption in all its details from the re- 
ports of the bureaus of statistics, and large averages of the wages earned 
from these reports and from the census figures ; then worked back from 
the unit of the individual to the gross product consumed, class by class, 
by the population. I next ascertained what were actually the gross 
average profits of business in very many lines ; I estimated ever}^ thing 
consumed in two or three large branches of industry, and by many other 
methods I checked off the original figures. I was myself very much 
surprised at the close agreement of the various methods which I applied 
befo7-e I attempted to prove my conclusions by the final check from the 
census of the United States. I should have been tempted to join my 
critic in pronouncing the conclusion almost a reductio ad absurdutn, had 
not subsequent investigation and analysis confirmed the substantial 
accuracy of my first results. Great masses of capital impose upon the 
imagination and disguise the true relations of capital and the proportion 
of profits to production. 

The error into which my critic and others have been led is this : 
they have confounded the profits, savings, or addition to the capital of 



Hail' Can Jfag'es be Increased f 145 

the nation as a whole, with the indi"V"idual incomes of capitalists, mid- 
dle-men, merchants, manufacturers, and the Hke. Mr. Hawle)- has 
entirely overlooked this distinction, to -w-hich I call attention, in these 
"words : 

' ' It -will be observed that ibe measure of the sarings of a nation is something quite 
•different from the measure of thai which woiLld constitute the profits of individuals ; 
for instance, the manufacturer or merchant may make a very considerable profit out of 
his work, but he then distributes a Terr large proportion of this profit in his famDy 
•expenses, thereby sustaining a large number of pereons who are included among the 
so-called working classes or wage-earners. The final end or contribution to the capital 
•of a nation is, therefore, a very much less sum than the apparent aggregate profit 
which accrues to indi%"idnals from the rent of real estate, from interest, or from the 
income derived by the indi-vidual owners from manufacturing, railroads, or other 
investments, or from btisiness." 

A man may receive an income of one million dollars a year, but he 
costs only what he consnmes. The richest man rarely consumes more 
than a small part of his income in what may be called unproductive 
consumption ; what he and his family cost the country is the measure 
of their actual consumption in their own persons ; what they spend 
constitutes the income or share of the annual product of those among 
whom it is spent Every capitalist is a distributer as well as a con- 
sumer. There is, doubtless, much wasteful expenditure ; but the ques- 
tion may well be asked ; "What class wastes the most, the rich in their 
luxurious personal expenditure, or the mass of the people who spend a 
sum variously computed at $700,000,000 to $1,000,000,000 a year on 
spirits, beer, and tobacco ? So far as an}- computation is possible, in 
my judgment, the annual product, /'. e., the wage and profit fund, 
is impaired more seriously b)" the waste of the poor and ignorant, not 
only in drink, but in the purchase of bad food worse cooked, than by 
all the luxurious expenditure of the rich. This is an individual ques- 
tion, beyond the reach of governmental action, co-operation, socialism 
collective industry, or of any other empirical method. The right 
method of sa-ving the waste of products must be developed from 
within. It is personal to each indi^"idual, and cannot be imposed from 
■without. 

It is, doubtless, true that in the distribution of products more than 
ten per cent, of the whole passes from those who do the actual, direct, 
productive work of the country on farms, in mines, forests, and facto- 
ries, to others who become consumers of a part of these products 
in the emplo}TDent of the rich, the well-to-do, the capitalists, the mid- 
dle-men. under the direction of employers who are not commonly 
included among the working classes in the narrow interpretation of that 
term and who distribute products among those whom they employ. 
But the persons to whom they — the capitalists, merchants, and middle- 
men — serve as distributers of these products are themselves wage- 



1 46 The Industrial Progress of the Nation. 

earners or persons working for small salaries, although they are not 
directly the producers of the necessities of life. It is in this way that 
a very large proportion of those who are engaged in professional or 
personal service secure their share of the annual product. It follows, 
of necessity, that if this portion of the product, which is now distributed 
by way of rent, profit, interest, or by any other method under which it 
comes within the control of the capitalists or the well-to-do classes, 
should be withdrawn from them by those who do the actual work 
of production, then the employment would be withheld from a very 
large number of wage-earners who had previously derived their share 
through the intervention of these capitalists serving in the function of 
distributers. This large class, when thus deprived of their employment, 
must at once take to directly productive pursuits, in order to sustain 
themselves, in place of working for the well-to-do classes for whom they 
had previously worked. But since the product of the actual necessi- 
ties of life is now very apt to exceed the possible consumption of the 
year and since it is becoming more and more difficult to find a foreign 
market for this excess of the actual necessities of life, might not this 
change in the form of distribution work more harm than good ? For 
instance, a large number of the most skilful mechanics of this country 
are occupied in making pianos. Pianos are not necessities of life. 
The earnings of these mechanics reach them by way of the capitalists, 
or well-to-do classes. As yet there is no other market for the greater 
part of the pianos except in the supply of persons whose incomes are 
such as to remove them from th^ category of the " working classes," in 
the narrow sense of that term. The piano-makers are, therefore, con- 
sumers ; they add to the wealth of the well-to-do rather than to the 
capital of the country ; their product is not reproductive. They are 
consumers of products in the reproduction of what may be called 
wealth, but which is not capital, or labor saved for reproductive 
purposes. 

Now, if the annual product of the nation is the only source of wages, 
profits, and taxes, then it follows that, by so much as the piano- 
makers enjoy any share, or more than an average share as compared to 
other working-men and women, some other working-men and women 
must enjoy less. What, then, is the justification for this diversion of a 
part of the annual product, through the intervention of the capitalist, to 
unproductive consumption in the form of a piano ? If such a diver- 
sion cannot be justified, then the high-priced mechanics who make the 
pianos may have no right to exist in that way. It is not the capitalist 
who actually consumes the food, fuel, clothing, and shelter which they 
enjoy ; he is only an agent who has diverted a part of the product from 
the less adequately paid laborers on the farms, in the mines and the 
forests and the factories, or from the producers to the use of these 



How Can Wages be Increased ? i^y 

aristocrats among workmen, who convert rosewood and mahogany into 
the pianos which are merely for the enjoyment of the richer classes in 
society. 

Again, there are many families of five persons who employ five 
servants, each of whom consumes some other man's product. The 
capitalist working as a distributer diverts the production of five pro-^ 
ductively working people to the consumption of five persons in his own 
employment. By what right ? There is only so much to be divided, 
and by so much as some have more others must have less. All con- 
sumption must come out of all production : by so much as the few who 
produce nothing by their own personal labor become the consumers of 
the products of the many who produce every thing, so do the latter 
sustain the former. Where is the compensation ? That is the cause of 
discontent. Many an honest workman now sincerely contests the 
equity of distribution by way of capitalists. What is the true answer? 
There is, and can be, but one reply to this question. Labor does 
not produce the entire product ; it only shares in the work as it shares 
in the product. Without capital labor alone would be almost in- 
capable of sustaining those who constitute the mere working classes in 
the narrowest sense. Capital is a force, and capitalists are those who 
direct this force. By the direction which the owners or the adminis- 
trators of capital give to this force, which requires mental work of the 
most uncommon kind, the joint product of labor and capital is so much 
increased that, even though the capitalist secures to his own use a large 
part of the joint product, what is left to the working-man is more in 
quantity and in value than he could otherwise have attained by his own 
unaided efforts. In all commerce, in all manufactures, in all indus- 
tries, in all work of every kind, the forces of labor and capital must co- 
operate, and must render mutual service to each other. This law can- 
not be impaired by either without disaster to both. The capitalist 
adds more, by his service, to the joint pjroduct than he can possibly 
take away or divert to consumers in any form of rent, profit, or interest. 

If all labor, including that of the piano-makers, of domestic service, 
and of all other consumers, and if all capitalists also were deprived of 
the force of capital, and were obliged to get their own living by their 
own manual or directly productive work, all would of necessity be 
forced to work for the mere necessities of life. If all did so work in 
this country, and were not deprived of the use of improved tools, 
methods, and inventions, now controlled and applied by capitalists, this 
country, at least, would " be smothered in its own grease " ; all might 
fatten alike upon the gross product of mere animal necessities, without 
mental development or progress of any kind. 

The higher law which I have endeavored to develop in the treatise 
under consideration is this : that under just institutions those who con- 



148 The Industrial Progress of the Nation. 

stitute the working classes are, in fact, securing for themselves, 
decade by decade, for their own use and enjoyment, an increasing share 
of a constantly increasing product, and this is mainly due to the capi- 
tal used in their service, while capital, strive as it may, can secure for 
its own use, direction, or control only a diminishing share of an in- 
jcreasing product. Yet such have been the vasit benefits conferred by 
inventors and applied by capitalists to material production that this 
lessening share secured by capital from the present enormous product 
amounts to a larger aggregate of wealth than was ever before attained 
by any nation. We can afford to convert the luxuries of one genera- 
tion into the comforts of the next, and perhaps the necessities of the 
third, and we do so. The standard of material welfare is, in fact, con- 
stantly rising, and he only is left behind who does not qualify himself 
to grasp the ever wider opportunity for comfort and for welfare which 
is open to him in the exact measure of his own capacity and aptitude. 

I admit that these problems are of the very greatest difficulty. The 
attempt to convert the whole annual product of the nation into terms 
of money, and to measure with more than approximate accuracy the 
relative average share which each person can obtain, is perhaps beyond 
the power of economists and statisticians. I admit that only an ap- 
proximate estimate can be made ; but I point out that when we work 
from the unit of the individual to the gross product of the nation, and 
vice versa, we may possibly be surprised at the concurrence of our 
estimates, for the reason that an error of five cents a day comes to over 
f 1,000,000,000 a year ; therefore such an error may not be difficult to 
detect in the gross and to correct in the detail. 

I am of opinion that my critic, or any other investigator who takes 
hold of this subject at the right end, will have great difficulty in finding 
products made within the limits of the United States in a normal year, 
the gross value of which would come to more than $200 per capita of 
the existing population. The gross amount would now be $12,500,- 
000,000 at that rate. My own conviction is, that such an estimate is 
too large rather than too small. If any one can find more than 10 per 
cent, added to capital, or applied to the maintenance or to the increase 
of capital, he will do more than I have been able to do. 

There is another method of testing the accuracy of the estimate of 
additions to capital, which I will present, although it may be considered 
somewhat visionary. Imagination is a considerable factor, even in 
dealing with figures ; except for the play of the imagination they would 
be very dry bones. The average population of this country for 
the last century has been substantially 30,000,000 ; we now number 
over 60,000,000. Doubtless my critic and all other students would 
admit that there must have been every year, during the last century, 
an annual consumption, per capita, approximating what would have 



How Can Wa^^es be Increased f 149 

cost, at market p^rices, twenty-five to twenty seven cents per day fcr 
each person, $90 to $100 worth per year of food, fuel, shelter, and 
clothing. Let any one consider what can be had now, and how little 
could have been had in the last century, for twenty-five cents in food, 
fuel, shelter, clothing, and sundries, and it will then be apparent that 
such an expenditure or measure of consumption must have been made 
on the average of the century in order to sustain life ; hence, it would 
follow that the average price of life for 30,000,000 people each year has 
been about $100 a year. This would come to an average of $3,000,- 
000,000, by the measure of money for the average population of 
30,000,000. Multiply this by one hundred years, and we find the cost 
of subsistence to have been the visionary sum of ^300,000,000,000, a 
sum which conveys little idea to the mind, but which is suitable for 
purposes of analysis. What would be 10 per cent, upon this sum ? 
Would it not be $30,000,000,000 ? If, then, a sum equal to 10 per cent, 
of this assumed measure of the cost of subsistence had been set aside 
during the last century, we ought to find the latter amount of accumu- 
lated capital or wealth in existence in addition to the valuation of land. 
But there are no figures in the census, or anywhere else, which indicate 
any such amount of the product of labor now in existence in a salable 
form, aside from the value of the land itself. I do not attach any great 
authority to the computations of the value of the property of the 
United States, either in the census or elsewhere ; the superintendent of 
the census himself and the special experts give the reason why these 
figures are approximate estimates rather than statements of fact ; but 
there would be at least some sign of a quantity of capital, aside from 
or upon the land, measured as above, if it were in existence. Where 
is it ? 

What I have endeavored to prove is this : that not exceeding ten 
per cent, of the product of any year is, or can be, set aside, accumu- 
lated, or maintained ; it will vary from year to year. If the average 
cost of subsistence of all the people who have inhabited this country 
for a century, including rich and poor, high-priced mechanic and low- 
priced laborer alike, has been only what twenty-five cents a day would 
represent in the form of food, fuel, clothing, and shelter, then the sum 
of the capital, aside from the value of land now in existence, would be 
close upon $27,370,000,000. If the measure of the cost of subsist- 
ence for a century has been thirty cents a day, and ten per cent., 
or three cents a day, has been set aside for the maintenance and 
increase of capital, we should now have a capital, aside from land, 
of $32,750,000,000. Where is it? On the basis of figures which I 
have given, or on an assumed cost of living of twenty-five to thirty cents 
per day, there is no capital in existence which would represent ten per 
cent., or three cents a day, saved for each unit of the population inhab- 



r 50 The Industrial Progress of the Nation. 

iting the country one year, year by year, for the last century. Our 
present population is computed at about 60,000,000 ; if only three cents 
a day were now saved, the aggregate would be a little less than $670,- 
000,000 worth in a year ; but the average production of each person 
cannot now be estimated at much less than double the average of the 
century ; therefore ten per cent, upon our present product, six cents per 
day or $21.90 per year, set aside, per capita, would come to $1,340,000,- 
000. Can any one find any more ? I cannot. This would be lo^-^^ 
percent, on an annual product valued at $12,500,000,000. 

My critic and others imply that whatever is saved is secured by 
capitalists as a separate class, to the exclusion of others ; he alleges that 
" wage-receivers, on the whole, save little or nothing," the only appar- 
ent exception to this being the farmers, who, he says, are classed as 
wage-receivers in the census. I should be glad to have a citation 
of authority on this point. What proof is there that wage-receivers 
save little or nothing? This statement is, in my judgment, wholly 
erroneous. I think that wage-receivers, small farmers, or those who are 
in the position of the employed rather than the employer, on moderate 
or small salaries, have saved at least one half of all the capital which has 
been saved. The other half may perhaps be traced to the capitalists or 
to the middle-men, in whose hands it is the most potent force in 
production ; but there are no data within my knowledge by which 
to prove this hypothesis. It may appear, however, to any close 
observer, that the distribution of wealth in this country differs very 
greatly from that of any other country ; it is much more widely and 
more evenly shared. It would be a most interesting subject of 
research of students in post-graduate courses of study. 

If the propositions presented in this treatise can be sustained, it 
follows that the great and admitted disparity among the so-called work- 
ing classes cannot be attributed to any large or increasing share of the 
product of the country being secured by capitalists and added to their 
own accumulations. By analyzing the rates of wages as well as their 
purchasing power, it is proved that since i860, subject to temporary 
reduction in the purchasing power of wages during the period of war 
and paper money, the constant tendency of wages or earnings has 
been to rise both in rate and in purchasing power. By selecting the 
rates of wages given in Vol. XX. of the Census of the United States, 
compiled by Mr. Joseph D. Weeks, and assorting these rates by classes, 
the data being taken from over 100 establishments, I find that there 
is an increasing disparity among those who constitute the working 
classes in the strictest sense. Given a standard of the average con- 
sumption of food, fuel, and materials for clothing, rent being omitted 
because it varies so much in different parts of the country, it is ap- 
parent to any one who will devote sufficient time to a thorough inves- 



Haw Can Wages be Increased? 151 

tigation of the whole subject, that since 1865 the wages of foremen, 
overseers, boss blacksmiths, specially skilled cabinet-makers, and the 
like, have advanced 108 per cent.; average mechanics, engineers, car- 
penters, machinists, and the like, 90 per cent.; factory operatives and 
all persons engaged in the ordinary arts of making stoves, boots, hats, 
cars, wagons, and the like, 78 per cent.; and common laborers only 66 
per cent. Now, if these gains of the better class of workmen could 
be averaged in money and multiplied by the respective numbers of 
workmen in the several classes, I think it would appear without ques- 
tion that the aggregate of the larger share of the annual product 
secured by class i and class 2, as compared to classes 3 and 4, would 
come to a greater sum than that which is or can be added to capital 
by capitalists in any one year. Therefore it follows that, even if the 
share of the annual product which is now secured by capitalists to be 
added to their own capital, were evenly distributed among all who do 
the work, as great a disparity would continue to exist in the conditions 
of the working classes as exists at the present time; If it were un- 
evenly distributed the disparity among the working classes would be 
greater than it is now. I think it follows of necessity, from this pro- 
cess of reasoning, that the only logical agitator of the present day 
among the so-called labor reformers is the communist who objects to 
the whole existing method of distribution. The tradeunionist is en- 
tirely illogical, his object being to secure to the particular trade to 
which he belongs a larger share of the annual product than now comes 
to the members of that trade. He can only accomplish this at the 
cost of some other trade. He cannot attain any large advance in the 
customary rate of compensation at this particular trade at the expense 
of capital, because capital will quit the art unless it can earn the 
average of profits in other occupations. Does it not follow, from 
whatever point of view the distribution of products is taken up, that 
the measure of subsistence, shelter, and luxury which a man may ob- 
tain must, in the long run, be measured by the service which he ren- 
ders to the community as a whole ? That is to say, the measure of 
each man's income or share of the annual product is determined by 
his own capacity to supply each demand of the community. The 
demand may be for rum or it may be for wholesome food ; as to what 
the demand shall be each member of the community judges for him- 
self. Each consumer pays his fellow workmen, his employer, or the 
capitalist to whose capital he gives life and force, not for their benefit, 
but because he decides for himself that in such purchases he can 
serve his own needs better than he could in any other way. A larger 
measure of comfort and luxury, shorter hours of work, better condi- 
tions of life are, therefore, elements of individual character to which 
legislation can only give more or less free play. Hence it follows that 



152 The Industrial Progress of the Nation. 

most of the restrictive acts of public legislation and most of the re- 
strictive by-laws of the private legislation of trade-unions, knights of 
labor, and the like, retard rather than promote the development of 
general comfort and welfare. In the last analysis each man fixes his 
own rate of wages by the measure of his individual capacity. 

In conclusion/ let it be observed that if the accumulation not only 
of capital, but of all forms of wealth, reproductive or otherwise, dur- 
ing the last century has not exceeded three cents a day/^r capita^ or ten 
per cent, upon a consumption measured at thirty cents per day, then, 
the present value of all our national wealth, aside from the valuation 
put upon land, would be nearly three times the computed and prob- 
ably large valuation which I have put upon the present annual product. 
I think it is a well-established fact that such an accumulation can be 
reached only in the richest and most prosperous State. I made an 
analysis of the wealth and product of Massachusetts in 1875, with 

^ The writer was led to prepare this article by a review of his book upon "The 
Distribution of Products," contributed by Mr. F. B. Hawley, to the Quarterly your- 
nal of Economics of Harvard University. When writing this first article of the Forum 
series it did not occur to him that it would be the first of a series of ten ; hence the 
controversial form in which the subject is treated in this first number. 

In the Forum for May, 1889, Mr. Hawley published a rejoinder under the title of 
" Edward Atkinson's Economic Theories," in which he again contests the accuracy of 
the computation made by me in respect to the annual product of 1880. He admits or 
accepts the substantial accuracy of the estimate of that part of the annual product which 
had been assigned by me as the sum of all wages, small salaries, or of the earnings of 
the small farmers, whom he classed with their hired men among those who earn little 
more than the cost of living, computed at $8,100,000,000. But Mr. Hawley believes, 
the portion, or share, of the annual product assigned by myself to profits, or to rent or 
interest, or under whatever other title the share of the capitalist and of the man who is 
not in a strict sense a wage earner may be called, to be altogether too small. 

He estimates the share falling to the owners of property as the measure of increase 
at thirty-nine hundred million dollars, in place of nine hundred million dollars com- 
puted by myself, a difference of three thousand million dollars. But Mr. Hawley does 
not inidertake to estimate the value of the annual product itself ; he does not show 
where there was any material substance or product of 1880 to be added to my computa- 
tion, although he fully accepts the principle that the annual product or the prodttci of 
each series of four seasons is or must be in the nature of things the source of all rettts^ 
profits, interests, wages, salaries, and earnings. He says, in respect to this principle : 
" Nothing can be more clearly stated than this proposition, to the exact truth of which. 
I cordially assent." 

So far as I can comprehend the somewhat obscure methods of reasoning on the 
basis of which Mr. Hawley contests my estimates, it is on the ground that the " services 
of wealth " must be compensated in somewhat the measure which he has assigned 
thereto ; and he appears to hold, if I comprehend his position, that services of any 
kind for which compensation is made are to be classed as products. I confess to a great 
difficulty in the treatment of criticisms based on such a definition. 

If the annual product of food, fuel, fibres, and fabrics of all kinds is the source of 
all wages, profits, etc. , it must also be the source of the compensation for all services. 



How Can Wages be Increased f 153 

the aid and criticism of Carroll D. Wright, and we could then barely 
find a sum of wealth equal to three years' product in what is probably 
the richest State /<?;- capita in the Union. 

If, then, we cannot find in existence any form of capital or wealth 
aside from the valuation of land, even including, as in the census 
estimates, public property which is of the common wealth — and my 
critics, who doubt my estimates or my distribution of the annual prod- 
uct should find an annual product of much greater value than my 
estimate, — then it would follow that less than ten per cent, has been 
or can be saved in a normal year to be applied to the maintenance 
and increase of capital. It would then be proved that want treads 
closer on the heels of plenty than even I have ventured to suggest. 

In the last analysis it Avill appear that there is no such thing as 
fixed capital ; there is nothing useful that is very old except the pre- 
cious metals, and all life consists in the conversion of forces. The 

Now if there was no additional product in the year 1880 to be found anywhere, equal 
to the sum assigned by Mr. Hawley as compensation for the services of wealth — and if 
the sum assigned by me from the product to wages, earnings, and salaries is correct, 
how can the service of wealth be compensated in any greater measure than by the 
remainder of the annual product at the measure which I have assigned, if my compu- 
tation of the gross product is approximately correct ? 

I can only submit to Mr. Hawley, and those who concur with him in his criticisms 
of my estimates, that they must take these estimates for what they are worth. My 
computation was at least an honest attempt to solve a difficult problem, and it has been 
sustained by many subsequent computations. Any determination of the respective 
shares falling to capital and labor must be of little value until the subject of division, 
which is shared, to wit, the anmial product, shall be proved to be greater than my com- 
putation. I fully admit the possibility of error, but I admit only a small margin for 
error. 

I cannot agree, however, with Mr. Hawley in his conception that a service for 
which compensation is made is the same as a product, and should be classed with 
products. For instance, there are two classes of boot-blacks — one who will black my 
boots at the corner of the street at a charge of five cents, the other who will black my 
boots in the office of a hotel at a charge of ten cents ; I pay either sum for the sers'ice 
as I may choose, and the boy who receives the money spends it in order to secure his 
share of the annual product — food, fuel, clothing, and shelter, on which he exists. 
This is one of the minor services, rendered by the relatively poor to the relatively rich, 
which Mr. Hawley treats. In this form of service the boot-black obtains his share of 
the annual product. 

On the basis of Mr. Hawley's reasoning, however, the boot-black at the corner of 
the street who renders the service at five cents adds five cents to the annual product 
of the country, while the boot-black who renders the service in the office of the hotel at 
ten cents adds ten cents to the annual product, and, therefore, to the wealth which is to 
be divided. If this view is correct, it would be incumbent upon Mr. Hawley always 
to have his boots blacked in the hotel rather than at the corner of the street, as he will 
thereby add to the sum of services which, he says, must be classed as products, and he 
would thereby increase the annual product of the people of this country which is subject 
to division by ten cents' worth every time he has his boots blacked. 



154 The Industrial Progress of the Nation. 

only capital which is of permanent value is immaterial, the experience 
of generations and the development of science. It is not given to 
material capital to save any one generation from the work of getting 
its own living ; all that it can accomplish is to lighten the labor ; the 
condition on which it attains its own income is, that it shall render 
full service for all that it receives and that it shall also render the 
general struggle for life less and less severe. 



II. 

MUST HUMANITY STARVE AT LAST?" 

IN a review of my analysis of the distribution of products, in the 
Quarterly J^ournal of Eco7tomics, T^whXhhed for Harvard Universi- 
ty, to which I made a rejoinder in part in the July number of the 
Forum^ a much wider issue is raised than the mere question of the 
accuracy of my figures of distribution. Having treated some of the 
questions of fact which are at issue, a short treatise on the theory of 
wages may be timely. 

My critic says : " Mr. Atkinson's results will not be so readily 
accepted when his very inadequate comprehension of the theories of 
Malthus and of Ricardo are called to mind." Again he says : " Among 
economists, especially among those who believe that statistical investi- 
gation can rarely be fruitful of any valuable results except in the hands 
of an investigator well grounded in economic theory, Mr. Atkinson's 
results will not be readily accepted." In this latter statement my critic 
presents an example of the danger to which the student of books is 
exposed in becoming a mere interpreter of the hypotheses of writers 
who may have failed to adopt a true inductive method, or who may not 
have been capable observers. Possibly Malthus and Ricardo may have 
applied great ability to false theories, by which a vast deal of mischief 
has been done, and it may not be consistent with true economic science 
to adopt their hypotheses. 

It may be fully admitted that in the physical sciences some of the 
most brilliant results have been attained by deductive methods based 
on hypotheses or a priori concepts, but one may well distrust such 
methods in economic science. If the a priori concepts of Malthus and 
Ricardo are to be received as demonstrations of science, then of what 
use are all our efforts to prevent war, to stop famine, to alleviate 
poverty, or to save life from disease and pestilence ? The more we 
accomplish for the present generations of men the more must posterity 
suffer, the more urgent must the struggle for life become, the more fear- 
ful must be the anarchy when the whole art of living can consist only in 
securing a sufficient subsistence for the few by any method of force or 
' Reprinted from the Forum. 
155 



156 The Industrial Progress of the Nation. . 

fraud, even at the cost of those who starve. In other words, if human 
passions and human nature lead to a disproportion of population in 
ratio to the means of subsistence, or if the mind of man applied as a 
factor to production cannot provide for this tendency of population to 
increase without resort either to violent or to purely artificial methods 
for checking it, then indeed does political economy become a " dismal 
science " ; and may we not as well " eat and drink, for to-morrow we 
die," without taking any thought for the future of our race ? 

The fault of these hypotheses may be that their proponents had not 
taken cognizance of the human mind as a factor in material production. 
They were based on very narrow observation, and when they were put 
forth the science of statistics had little more than an elementary exist- 
ence. One may well ask whether so acute a reasoner as either Malthus 
or Ricardo would have ventured to present either hypotheses, had 
either one conceived that within a short period ironstone would be con- 
verted into food for man and beast, by grinding into powder the 
phosphoric slag which is the waste product of the iron furnace under 
the basic process of .making steel and using it as a fertilizer. 

I have ventured to doubt the validity of the hypotheses of Malthus 
and Ricardo, whether I comprehended them or not, because they have 
not yet been sustained either by experience, by observation, or by sta- 
tistics. The hypothesis of Malthus is very simple ; it may be stated in a 
very few words, to wit : " there is a tendency of the population of tlie world 
to increase faster than the means of subsistence." ' He even held that, while 
population might increase in a geometrical ratio, the means of sub- 
sistence might increase only in an arithmetical ratio. The hypothesis- 
of Ricardo in respect to rent is also very simple ; he holds that econoinic 
rent is the margin of product of the better or the inore accessible land over 
and above the returns which can be obtained from the poorer or more dis- 
tant land, of which the product will only repay the cultivator for the cost 
of production. Both these hypotheses rest upon the so-called law of 
diminishing returns from land, under which it is held that land may 
fail to yield an equal increment of product in ratio to equal increments 
of labor and capital expended upon 'it. If these hypotheses are pushed 
to their logical conclusion, and if there is no countervailing force 
which may ultimately bring land and life, or population and produc- 
tion to an equilibrium, does it not of necessity follow that all our 
humanitarian or philanthropic efforts may only make the final catas- 
trophe so much the greater ? 

Admitting that a century or less is quite insufficient to warrant 
absolute inductions from experience, yet it may well be considered 
that there has not been a single decade, since the hypothesis of 
Malthus was first presented, in which the means of subsistence have 
not gained very rapidly upon the population of the world. 



Must Humanity Starve at Last f 157 

What are the facts with respect to the hypothesis regarding rent 
presented by Ricardo ? 

First. Experience proves that a given and limited area of land of 
high fertility, when cultivated for a series of years in a certain manner, 
will doubtless yield diminishing returns in proportion to the amount 
of labor and capital expended upon it. Such land may finally cease 
to yield a profit sufficient to pay the cost of cultivating it, in which 
case there can be no economic rent, and the land may for a time go 
out of cultivation, until the pressure of population reduces the stand- 
ard of living to such an extent as again to compel its cultivation even 
for the most meagre returns. Such is the fact in regard to consider- 
able areas of land in England to-day. 

The present condition of Great Britain, under the system of large 
entailed estates which have been cultivated for a comparatively short 
historic period to the present time, mainly by tenant-farmers under 
leases which prevent free use, gives one example of the failure of land 
to yield adequate returns for the kind of labor and the method of 
directing the capital expended upon it. The failure may not happen 
for lack of abundant product, but because the product is of high cost 
and not suitable to present conditions. It does not follow that some 
other method would not yield adequate returns. Again, the present 
condition of many parts of the continent of Europe under the system 
of forced subdivision of land, by which the parcels have become too 
small for application of machinery to them, affords another example of 
the limited truth of the hypothesis of diminishing returns. 

But both in Great Britain and on the Continent examples may be 
found of such exceptions to this supposed law as to invalidate the 
rule ; while, again, the whole area in which this alleged rule appar- 
ently finds limited support constitutes so small a fraction of the surface 
of the earth as to make any deduction from the results obtained from 
it a mere exception, or else a result attained under such exceptional 
conditions as to be of no force whatever in sustaining a universal law 
supposed to cover general production. 

Secondly. A given area of land of high fertility may be divided 
into parts by a line. On one side the cultivation may be carried on 
as in the foregoing examples, and the land may be finally exhausted, 
so far as that kind of cultivation is concerned. On the other side of 
the land of the same quality, treated by different men, or by a suc- 
cession of men of a different or more intelligent type, or working 
under better institutions, may yield a larger and larger product 
through a period of at least a century. This has been proved in the 
history of this country. A fair example may perhaps be found in the 
relative conditions of the central part of the State of New York, as 
•compared to some of the more fertile portions of the land of Lower 



158 The Industrial Progress of the Nation. 

Canada inhabited by the French population. In the one case a 
steadily increasing product may be found in proportion to the capital 
and labor ; in the other, diminishing returns in ratio to population, 
accompanied by the forced migration of the French habitans. 

Land of the same original quality, in the same field, divided only by 
a line, may, therefore, on the one hand, prove the law of diminishing 
returns and may be cited as an example of the entire loss of economic 
rent ; while on the other side of the line, under a better mode of 
treatment, a law of increasing returns and of higher rent may be 
proved. Of course there may or must be a final limit, and by admit- 
ting a final limit it may be held that the hypothesis of Malthus is so 
far justified ; perhaps, however, at so remote a period as not to be 
entitled to present consideration, if ever. 

Thirdly. It may be asked, Where is the man who can yet measure 
the potential of an acre of land anywhere, or where is there an acre of 
land of which it may be positively affirmed that it cannot yield a larger 
product than it has ever yet done, in ratio to the labor and capital which 
may be put upon it ? Who can say that there is not some other limit 
to the increase of population than the violent methods which have 
heretofore been held to be the principal retarding forces in the case ? 
May it not be held that the a priori concepts of Malthus in regard to 
population and of Ricardo in respect to rent are, to say the least, not 
yet proven ? No man can venture to define the point at which the 
equilibrium between life and land or between population and pro- 
duction may be destroyed, or the utmost limit at which it can be 
maintained ; for the reason that no one can yet venture to limit the 
applications of science and invention to the subsistence of man. It is 
not necessary to assume that there must be artificial restrictions upon 
the increase of population. Just as the most grasping and penurious 
money-getter accumulates capital and applies it to uses benefiting the 
community, while he costs only what he himself consumes, working 
almost automatically and without any knowledge of his own functions 
or utility in the social order, and thus becoming a conservator of the 
force of capital, so may there be laws for the conservation of that form 
of force which constitutes human life of which science has as yet no 
comprehension. Land itself may be exhausted when treated as a 
mine ; it may be maintained when worked as a laboratory. Its potential 
in the increase of fertility and production, when used as a tool or in- 
strument for diverting nitrogen and carbon from the atmosphere and 
converting these elements into food for man and beast, is as yet an 
unknown quantity. 

In support of these views, and in answer to the question whether the 
soil is not to be considered as a laboratory rather than as a mine, I am 
permitted to give the following extract from a letter by Prof. W. O. 



Must Humanity Starve at Last? ^59 

Atwater, than whom no one has done more excellent work in develop- 
ing the resources of fertility, or in the application of science to the use 
of land as an instrument of production : 

" It is right to consider the soil as a laboratory and not as a mine, responding in just 
proportion to the intelligence and work put upon it. Of course there is a limit to the 
possible production, but it transcends all ideas that ever occurred to people in Malthus' 
time. The soil is the place of growth of the plant and the source of part of its food. 
Given plenty of water and food and proper temperature, and the amount of produce in 
a given area is immense. Professor Nobbe, a German experimenter, raised a single 
plant of buckwheat eight feet high and bearing nearly eight hundred perfect- seeds, and 
this not in sand at all, but in water containing proper plant-food. Similar results are 
obtained with other plants. Our common ideas of area and soil-product are based upon 
the experience in which the factors promised in future progress are left out of account. 
The possible production of a given area is far outside our usual calculations. 

" The problem of the world's future supply is conditioned upon two things : one is 
energy, power for manufacture and transport of plant-food, and transport of water ; 
the other is the supply of nitrogen. With the unmeasured energy of wind, flowing 
water, and tide, and the possibility of storage, transfer, and use of energy by electricity 
and other agencies, we may hope that the science of the future will provide the power. 
Late research makes an abundant nitrogen supply probable. Leaving out of account 
the question of present pecuniary cost and profit, the conditions of transport of plant- 
food, cultivation of soil, and water-supply for the maximum production are theoretically 
capable of being provided. Science and discovery have already found in the earth 
practically inexhaustible stores of all the ingredients of plant-food but carbon and 
nitrogen. The atmosphere supplies an abundance of carbon to plants from its con- 
stantly replenished store of carbonic acid. This reduces the problem of ultimate supply 
of plant-food to one of nitrogen supply. Four fifths of the air are nitrogen, but the 
question is whether this can be made available to plants. For a number of years the 
current doctrine has been that it cannot, but late experiments indicate that certain 
plants do have the power of assimilating atmospheric nitrogen in large quantities. 
Aside from investigations in this country (my own of which you already know), a num- 
ber have lately been made in France, and particularly in Germany, which bring the 
most direct and convincing evidence that legumes, including, probably, clover, have 
this power of obtaining nitrogen from the air. It will interest you personally to know 
that we are just commencing a new series of experiments here on this subject, with 
pea, alfalfa, cow-pea, clover, maize, and other plants. . . . Viewed from this 
standpoint, the prospect for the future of the race is not one of Malthusian dreadful- 
ness, but full of exalting inspiration." 

The a priori objection to which the hypotheses of both Malthus and 
Ricardo are subjected in my own mind is, that they tend to promote a 
contest between labor and capital ; to antagonism between the haves 
and the have-nots ; to ultimate destruction rather than to the conser- 
vation of life ; and they lead to the conclusion that the struggle for 
life must inevitably become more difficult and more violent, and must 
inevitably fail. 

In all problems in what is called political economy, which are 
commonly regarded as relating wholly to the production and distribu- 
tion of the material substances constituting wealth or necessary to 



1 60 The Industrial Progress of the Nation. 

material existence, one is inevitably brought back to the immaterial or 
metaphysical. The mind of man when applied to the direction of 
natural forces is the principal agent in material production, in fact, the 
controlling element. Those who claim that labor is the source of all 
production are utterly misled because they do not admit this funda- 
mental principle. May it not, therefore, be more consistent with the 
concepts of an enlightened faith of any type in which order is recog- 
nized in the universe, to present an hypothesis or a priori theory that, 
as the mental faculties of man are more developed and are more 
intelligently applied to the conversion of the forces of nature into 
material products, the general struggle for life will become less and not 
greater ? 

War, pestilence, and famine have devastated the world and have 
diminished the means of subsistence, during the last two centuries, far 
more than they have rendered the subsistence of the remaining popula- 
tion, whose increase has been retarded by them, more easy and 
adequate. On the other hand, where peace and order have reigned 
production has been increased, and the interdependence of men has 
been more fully acknowledged. As it has become more and 
more fully admitted in political science that each man, each race, 
each state, each nation serves the other by exchange, the pressure 
of want has been diminished, and one can dimly foresee the time when 
the prophecy of the poet may become a living truth, when 

" Down the dark future, through long generations, 
The echoing sounds of war grow fainter and then cease." 

Have the orthodox English economists since Adam Smith ever 
overcome the insular quality of their work, or sufficiently counted upon 
the mind of man as a factor in material production ? Perhaps these 
questions would occur only to one who has studied economic problems 
by the observation of the facts of life rather than in the treatises 
on which our economic reasoning has heretofore been based. Is it not 
desirable that more attention should be given to the method of Adam 
Smith than to the dogmas of Malthus, Ricardo, and Mill ? If so, then 
the facts which are now being gathered by statisticians, especially 
in this country, may hereafter serve to give a broad extension of the 
narrow and insular habits of thought which the students of political 
economy have derived mainly from English writers. Let it not be 
supposed for an instant that I assume that there can be an American 
system of political economy as distinguished from an English system. 
Such a conception would be utterly inconsistent with any true idea of 
science. Yet, is it not true that habits of thought are unconsciously 
controlled by the environment of the writer ? Witness the broad 
■extension of the English commercial system and the very narrow and 



Must Humanity Starve at Last? i6i. 

limited view which still obtains in respect to the local institutions 
of Great Britain. Witness the incapacity of Parliament to conduct a 
centralized system of government, especially in respect to Ireland, 
while the members of Parliament appear to be equally incapable 
of grasping the idea of home rule and local self-government under the 
central sustaining power of a great nation. 

On the other hand, have not the people of the United States devel- 
oped the broadest system of mutual service and support in respect 
to their internal commerce and the conduct of their home affairs ? 
home rule and local self-government being maintained in the strictest 
sense, backed by the whole power of the nation ; while the ideas of the 
people as well as of their legislators are distinctly provincial and 
limited in all that relates to the great commerce among nations. 

When the day dawns in which the English-speaking peoples of the 
world may become united under a system which shall give to every 
man the utmost liberty consistent with the rights of his fellow-men ; 
when national prejudice is abated, and the whole great body moves 
■onward in its effort to benefit the people of the world by mutual 
service, the word will then go forth to all other nations, Disarm or 
starve. The Statue of Liberty which stands at the mouth of the great 
harbor of our country may then, in truth, enlighten the world. This 
is the vision which lies back of the dry columns of figures, and which 
brings the imagination into play on the part of him who can read 
between their lines. 

I venture to believe that although the province of statistical science 
has been held subordinate to that of political economy or political 
science, it may yet become of paramount importance to the develop- 
ment of either branch of study. Doubtful as statistics may be, much 
as they depend on the sincerity of purpose and integrity of him who 
compiles them, and easy as it is for them to become twisted and 
confused, even by the unconscious bias of the observer or compiler, 
they may yet become a necessary foundation for any true inductive 
method in political economy, and must, therefore, be placed on an 
even plane, to say the least, in the estimation of the student. 

For this reason it might well be that travelling scholarships should 
be established in universities as prizes in the department of political 
economy, in order that wider and more accurate investigations may be 
entered upon, whereby the ^/;'/<?;7 concepts of most of the writers of 
the text-books may be tested, and maybe either sustained or put aside, 
as they are found to be consistent or otherwise with the facts of 
human life. The real man can be observed ; has the economic man, 
who would bring into action all the processes conceived by writers of 
the type of Ricardo and Mill, yet been discovered ? Is he not also an 
hypothesis ? It would, of course, be futile to attempt to do more than 



1 6 2 The Industrial Progress .of the Nation. 

to present the elements of this problem within the limits of a short 
essay ; but it ought now to be observed that most of the causes of 
antagonism between labor and capital, as well as the basis of most of 
the undertakings of the socialist, the anarchist, and the communist, 
find their justification in one or the other of the hypotheses of Malthus 
or Ricardo. 

The abstract nature of the concepts of political economy may 
perhaps be more fully comprehended by a consideration of the 
deplorable results which have ensued from the general adoption of 
false theories in respect to trade. The folly of the mercantile system 
attained its most pernicious result in the attempt of Great Britain to 
oontrol the trade of the colonies of America for the supposed 
exclusive benefit of her own people. Had the " Wealth of Nations " 
been written fifty years earlier, and had it attained the influence in 
1760 which it began to attain in 1824, under the lead of Huskisson, 
there might have been no violent separation of the colonies of America 
from the mother country. 

The so-called " iron law of wages " developed by Lasalle and Carl 
Marx, under which it is assumed that the rate of wages will be kept 
down to the. limits of a meagre subsistence, is accepted by the anar- 
chists and communists of Europe and their few representatives in this 
country. It is an absolute fallacy except in dynastic states overbur- 
dened with armies and debts. The misconceptions of fact in respect 
to the progress from poverty, on the part of the great body of working 
people in this country, and the acceptance of Ricardo's theory of rent, 
lie at the foundation of the fallacious reasoning of Henry George 
respecting the private ownership of land ; and so one might go on 
throughout the list of misconceptions in regard to abstract theories or 
hypotheses which have been the occasion of more wars and greater 
misery than all other causes of violence combined, not even excepting, 
the conflict of creeds. 

If the function of government were admitted to be to give each 
man an equal opportunity to make use of the benefits which science 
and invention place at his disposal, and to do, through the intervention 
of government, only such actual work as can be done by society in its 
corporate capacity better than individuals can do it for themselves, 
most of the obstructions which legislation has placed in the way of 
mutual service would soon be removed, and the true law of human 
progress would then develop itself. Wages would then increase to the 
maximum within the limit of a product attained under the most, 
favorable conditions. 



III. 

PROGRESS FROM POVERTY.' 

THE purpose of the present article is to bring once more into 
notice certain facts which the writer has given in other publica- 
tions, which are not only wholly inconsistent with the hypothe- 
ses of Malthus and Ricardo, but which must be disproved by Henry 
George and other writers of his class, who attribute the admitted 
poverty that is to be found in the worst quarters of our great cities 
wholly to faults in the government and in the laws, before their empiri- 
cal methods of abolishing poverty can be entitled to any serious con- 
sideration. In recent discussions these statements have been cited as 
authoritative alike by the advocates of free trade and of protection, of 
paper money, of the single gold standard, and of the limited coinage 
of silver. As yet no one has contested the substantial accuracy of the 
conclusions which I have drawn from these data. The only exception 
taken to them has been that they are partial and limited and have not 
covered as wide a field as they ought. In presenting them I have 
myself always said that they might be incomplete, and that their pur- 
pose was rather to give a direction to the line of future investigation 
than to present conclusions. That direction has been given in the 
establishment of the National Bureau of Labor Statistics, and in the 
resolutions which have been passed by Congress instructing its officers 
how to proceed in their inquiries. Of their sufficiency each student 
must judge for himself. 

It has long been apparent that the circulation of a depreciated 
promise of the government, issued in time of war for the collection of 
a forced loan, as well as the pressure of the war itself in its effect 
upon prices, had vitiated all deductions by which the condition of 
men at one period as compared to another could be determined. No 
true comparison of conditions can be made in terms of money, when 
the money itself varies in value ; therefore some other standard must 
be adopted in order that just conclusions may be reached in regard to 
these relative conditions. The mere rate of wages, given in terms of 
money, has proved to be as fallacious a standard by which to measure 

' Reprinted from the Forum. 
163 



164 The IiidusU'-ial Progress of the Nation. 

the relative conditions of working people in this country during the last 
twenty-five years, as it now is when made use of for comparing the 
conditions of workmen in this country with those of other countries. 
The rate of wages in itself constitutes no standard whatever for the 
comparison of conditions, even when the same money standard is 
in force, because the cost of labor cannot be determined by a mere 
comparison of price or rate of wages. I have therefore endeavored to 
establish a multiple standard for the comparison of the relative condi- 
tions of workmen and capitalists in this country at different dates 
during the last twenty-five years. This multiple standard consists of 
equal quantities of the same kinds of food, fuel, and materials for 
clothing, corresponding to the average daily consumption of an adult 
workman in the Eastern or Middle States. 

I first entered upon the investigation of the statistics of the con- 
sumption of food by quantity. I ascertained the average quantity and 
cost of each of the different elements of food consumed in the factory 
boarding-houses of New England and of the Middle States, such sup- 
plies being usually purchased with due economy and used with fair 
regard to preventing waste. Having established this food standard, 
measures were next taken to bring the subject to the attention of the 
Chief of the Bureau of Labor Statistics in Massachusetts, Commis- 
sioner Carroll D. Wright, and at a later period of the Chiefs of the 
Bureaus of other States. The result of these various investigations 
has been that the average ration or portion of food such as actually 
constitutes the daily supply of an average artisan, mechanic, or other 
workman, has been well established in all its elements. It varies a 
little in different parts of the country according to the relative con- 
ditions. This average daily ration was next submitted to Professor W. 
O. Atwater for analysis. The respective proportions of the nutrients, 
so-called, /. ^., of starch, fat, and protein or nitrogenous material, were 
found to be much above the normal standard of good subsistence. The 
elements of this average daily ration are given in a subsequent table. 

I next computed the average annual consumption of the materials 
for clothing, of boots and shoes, and of fuel. Having reached a 
certain standard in yards and quantity, I multiplied this standard by 
the population of 1880, counting two children of ten years or under as 
one adult, and found that the result of this computation more than 
exhausted the entire product and import of textile fabrics and other 
necessities of life treated in that year. The proportion assigned would, 
however, be warranted by the conditions of life in the Northern and 
Middle States as compared to the Southern or extreme Western States. 

I next attempted to establish a unit of rent or shelter, but the con- 
ditions in different parts of the country were found to be so variable 
as to make this attempt impracticable. It became apparent, however, 



Progress and Povcriy. 165 

that the standard of rent or cost of the dwelling-places occupied by 
working people had varied since i860 in substantially the same pro- 
portion as the cost of the materials for food, for fuel, and for clothing. 

The proportions of these elements of life, namely, food, fuel, and 
materials for clothing, which are assigned to a day's or a year's supply 
in the subsequent table, corresponding to the average consumption in 
the Eastern and Middle States, are doubtless above the average con- 
sumption of the whole country, especially in respect to tea, coffee, and 
sugar ; but although such is the fact, and although the actual consump- 
tion of food, clothing, and fuel may not in any single case have 
corresponded identically with this multiple standard, yet it may be 
safely assumed that as the prices of the necessities of life which are 
included in this standard have varied, so have the prices of the actual 
quantities consumed also varied. 

It may also be remarked that in the northern parts of this country 
the price paid for the materials for food amounts to about one half the 
annual expenditure in the family of an average workman ; in the 
family of the common laborer the price of food is more than one half 
the annual expenditure. If to the cost of food be added the price of 
fuel and materials for clothing, then the several elements included in 
the multiple standard correspond substantially to about seventy per 
cent, of the total cost of living in the family of an average workman. 
If it be admitted that as the cost to the workman of these necessities 
of life has varied, so has the cost or price of rent or shelter and 
sundries varied, we then have in this multiple standard a fair gauge by 
which to test the variation in the purchasing power of paper money as 
compared to specie at different periods, and also the purchasing power 
of a day's or a year's earnings in time of peace or war, or under the 
changing conditions which were first brought about by the depreciation 
of paper money and subsequently repeated during the long struggle 
for the restoration of the specie standard. 

I had made great progress in providing data for this multiple 
standard before the pubtication of the twentieth volume of the United 
States Census on Prices and Wages, compiled by Mr. Joseph D. Weeks ; 
I was therefore in a position to make use of this volume and to check 
off the data contained in it. I could verify many of the tables from 
my own knowledge of the facts governing many of the establishments 
named therein. It is also plain to any one who is accustomed to the 
examination of statistics that very many of the returns in this volume 
are correct, while a few testify to want of care in their compilation. 
The latter may be readily set aside. I was also in a position to add to 
the data of this volume, which came down only to 1880, inclusive, 
corresponding figures for the years 1885 and 1886, derived of course 
from a much narrower circle of establishments. 



i66 The Industrial Progress of the Nation, 

In making selections from this volume for the comparison of the 
purchasing power of wages by the use of the multiple standard, I have 
selected arts or occupations which have been in substantially continu- 
ous operation during the whole period under consideration, that is, 
suh)ject to very itw stops or none. I am aware that the adverse com- 
ment on this method will be that during this period, since i860, there 
has been greater variation in the supply of and demand for labor than 
at previous dates or periods of economic history. Such stupendous 
changes could not have occurred in a single generation without giving 
some support to this criticism. Space will not permit me to treat this 
branch of the subject ; suffice it to say that my own observation has 
led me to the conclusion that in each period of commercial panic, 
namely, 1866, 1873, and for a few years of alleged depression subse- 
quent thereto, as well as in the recent period of alleged depression, 
from 188 1 to 1886, the number of the unemployed has been very much 
exaggerated. In my judgment, compulsory idleness has hardly existed 
at all, except in connection with the alternate periods of cessation and 
of great activity in the construction of railways, and has rnainly affected 
the workmen employed in that branch of industry, reacting of course 
in a limited measure upon others. 

It may also be apparent from the data that I have submitted, that 
this period of steady reduction in prices since the end of the Civil War 
has been in fact a [jcriod of the greatest progress in material welfare 
ever witnessed in this or in any other country. The temporary diffi- 
culties, local distress, and congestion of labor, limited rnainly to some 
of our great cities, have been mere incidents in the adjustment of 
society to new conditions of an assured abundance such as were never 
before achieved. It has happened that there has been temporary want 
in the midst of general plenty and welfare ; but this want has been 
limited to a very few conspicuous points, where it has perhaps attracted 
more attention than its porportion called for. 

With this explanation I submit the subsequent diagram or object 
lesson (page 170) in illustration of the various changes which have 
occurred in the relations of labor and capital since i860, first giving 
the elements of the multiple standard. 

In 1887 prices fell a little lower than in 1886, and in 1888 they have 
begun to rise in some small measure, while there has been no substan- 
tial variation in general wages since 1885. A decline has occurred in 
a few arts, mainly those which are dependent on railway construction, 
but there has been a moderate advance, or tendency to advance, in 
other directions. It is commonly assumed, and may be admitted, that 
wages in agriculture exert a powerful influence upon those in other 
departments, and that farm labor may be taken as a standard. In the 
last official report of the Department of Agriculture, No. 51, May, 



Progress and Poverty. 



167 



1888, Mr. J. R. Dodge, the Statistician of the Department, says thai 
" the result of the May investigation of the wages of farm labor ij 
almost identical with that of three years ago ; the changes are very 
slight, though local differences occur, the averages of several sections 
or groups of States being changed very little." 

MULTIPLE STANDARD. 

Tahlk a. — A Single Day's Ratio.v, with its Averaok Cosi i.n 1880, 1S81, and 

1882. 

Tabi.k V>. — 4fX) Ka'hons, ok i Ykar's Si/pi'I.y fok i Aiji;i,t wiih 35 Extra 

Rations. 

It is assumed that the prices of rncat and fish (fresh or salt) and poultry, will have varied 
suhjstantially with the variations in salt and smoked meats, and as the prices of the 
latter are more uniformly quoted, the prices used in making up the general standard 
are thr^se given for salt and smoked meats. In the same way the fjrice of potatoes has 
been taken as a standard for the variation in the price of all green vegetable food or 
rwHs. 

A. — One Ration per Day B, — 400 Rations. 

Yz t(j I lb. meat, poultry or fish, 2fxj lbs. corned beef. 

varying according to kind and \</) lljs. salt pork. 

quality, costing on an average. 10 I'xj lbs. smoked ham, 

Yz to Yi pint milk 1 lf>j quarts milk. 

X U) 1Y2 <>'- butter r 5 30 lbs. butter. 

Yz to ^ oz. cheese ) 20 lbs. cheese. 

I egg every other day Y^ '7 '1"'- ^^V.V,'^- 

% to I lb. brea^l 2^ i barrel flour. 

Y2. I^arrcl corn meal. 

Vegetables and roots 2 %, 2^ 20 l/tishcls |*otatf>es, 

.Sugar and syrup 2 ■ 80 lbs. sugar. 

Tea and coffee i 4 lbs. tea. 

8 lbs coffee. 
Salt, spice, fruit, ice,and sundries i)^ % 2 %f> worth assumed at all dates. 

25 cts. f 100 



VtKHUKHU y<>KT\'lH <lV f.UfrW POH ONE VEAK ; 

10 yards medium brown cotton. 
10 " standard gingham. 
10 " 36. in. bleached shirting. 
20 " printed calico. 
10 " 4-fjz woolen flannel, or worsted 
dress g'xxls. 
5 ' 16-OZ. cassimere. 
5 " Kentucky jean, satinet, or light 
cassimere. 



•TAWDAfflJ ItV Wt<rv% Kii\> SHOKS FOK <lHV, VEAK : 

2 pairs men's heavy bwjts, 

STAKOARIJ <>V KCRI, VOU < itiV. VKAK I 

lYz tons anthra<;ite coal or its equiva- 
lent in bituminous coal or wood. 



In establishing the average cost of a day's portion of the above, the prices given in 
Vol. XX. of the U. S, Census, in 10 shops east and 10 shops west of HufTalo, i86^>- 
1880, have been averaged for each year designated. These prices have been verified 
from other vjurces of information. Prices of dry gfxjds have been verified fully. 
Prices for 1885 and '86 have l>een derived from typical establishments and from market 
reports. The average prices of 1885 and '86 were jjrobably less than the estimate used. 



i68 



The Industrial Progress of the Nation. 



The following table presents the sectional averages from 1866 to 
1888. It will be observed that from 1866 to 1879 wages were rated in 
depreciated paper money gradually approaching the specie standard, 
and that while wages were nominally less in rate after resumption, their 
purchasing power was much greater. See subsequent table : 



Sections. 


1888. 


1885. 


1882. 


1879. 


1875. 


1869. 


1866. 


Eastern States 


$26.03 
23.11 

14-54 
22.22 

38.08 


$25.30 
23.19 
14.27 
22.26 
38.75 


$26.61 
22.24 
15.30 
23.63 
38.25 


$20.21 
19.69 

13-31 
20.38 
41.00 


$28.96 
26.02 
16.22 
23.60 

44-50 


$32.08 
28.02 
17.21 
27.01 
46.38 


$33-30 
30.07 


Middle States 






28.91 
35-75 






Average U. S 


18.24 


17.97 


18.94 


16.42 


19.87 







Average Eastern, Mid-^ 
die, and Western | 

States, excluding}- 23.79 23.58 24.16 20.09 26.19 29.04 30.76 
vSouthern States and | 
California J 

These are the wages per month of farm laborers hired by the year 
without board, the workmen boarding themselves. The average of 
1888 of the whole country, with board, is $12.36. The day wages in 
harvest time in 1888, without board, averaged $1.38 ; with board, 
$1.02. The day wages of ordinary farm labor other than harvest 
hands averaged, without board, $0.92 ; with board, $0.67. The aver- 
age of the whole country is, however, somewhat delusive, being greatly 
affected by the low rates of wages prevailing in the Southern States,, 
especially among the negro population. If we take two States as ex- 
amples of agricultural communities devoted mainly to wheat and corn, 
for instance Minnesota and Iowa, we find the average wages per month 
of hands hired by the year in those States to have been, without board, 
in 1885, $25.40 ; in 1888, $25.67 ; with board, in 18S5, $16.87 ; in 1888, 
$17.41. 

In harvest time the day wages were as follows : 

Minnesota, in 1885, $2.29. 

'' 1888, 2.20. 

Iowa, . . " 1885, 2.00. 

'' 1888, 1. 81. 

The urgency of the demand for labor in harvesting wheat is great- 
est in Minnesota, whereas in Iowa maize or Indian corn is the chief 
crop, on which the demand at harvest time is not so urgent. The day 
wages of ordinary farm labor in Minnesota and Iowa, with board, were 
practically one dollar a day both in 1885 and 1888, and from $1.25 to 
$1.30 without board. 

I now submit the rates of wages in the manufacturing and mechanic 
arts, compiled from the twentieth volume of the Census and from data 
gathered by myself for 1885 and 1886. 



Progress and Poverty. 169 

Class I. — Specially Skilled Men : Foremen, Overseers, Boss Blacksmiths, Carpenters, etc. 
Customarily Earning $3.00 to $5.00 per Day at the Present Time. 

Average per Year. 
Year. Average per Day. 300 days. 

i860 $2.45 $735-oo 

1865 3-57 1071.00 

1870 4-34 1302.00 

1875 4-14 1242.00 

1880 4. 14 1242.00 

1885 ) Probably higher than in 1880. 

1886 [ ^ 

Class II. — Average Mechanics, Engineers, Blacksmiths, Carpenters, Machinists, and- 
Painters Connected with Establishments Reported in Vol. XX. of the Census, 1865 
TO 1880, Inclusive. 
Year. Average per Day. Average per Year. 

i860 ; $1.56 I468.00 

1865 2.34 702.00 

1870 2.43 747-00 

1875 2.29 687.00 

1880 2.26 678.00 

1885 ) 2.40 720.00 

1886 f 

Class III. — All the Operatives, except Foremen and Overseers, in 100 Establishments 
Reporting the Wages of their Working People under more than 1200 Separate 
Titles : Bricks, Marble, Furniture, Agricultural Implements, Tin-w-^re, Stoves, 
Boots, Hats, Cars, Wagons, Flour and Saw Mills, Iron, Paper, and Textiles, Em- 
ploying Men, Women, and Children, from 20 to 2000 in Each. 
Year. Average per Day. Average per Year. 

i860 $1.33 $399-oo 

1865 1.88 564.00 

1870 1.94 582.00 

1875 1-77 531-00 

1880 1. 71 513-00 

1885 } 1.80 540.00 

1886 f 

Class IV. — Laborers, Computed Separately, Connected with above Establishments. 

Year. Average per Day. Average per Year. 

i860 $1.01 $303.00 

1865 1.56 468.00 

1870 1.58 474-00 

1875 1.38 414.00 

1880 1.34 402.00 

1885 } 1.40 420.00 

1886 s 

Having thus determined the average rates of wages at different 
periods, it next became necessary to determine the retail prices of the 
various articles constituting the multiple standard. The method 
adopted is stated in the foregoing table. The cost of retail price to 
the consumers of a single portion or daily supply of the articles con- 
stituting this multiple standard, computed for equal quantities of the 
same kinds of food, fuel, and materials for clothing, has been as 
follows, the average of each year being given as stated from twenty 
returns, the average computed on twelve months' prices, month by 
month : 



170 



The Industrial Progress of the Nation. 



i860 $30x^1? cents each portion. 

1865 SSt'A 

1870 43t5V 

1875 38AV 

1880 33^2.4o 

1885 and 1886 30 

For the latter years, 1885 and 1886, having less adequate data than 
for the preceding years, I have adopted a maximum of thirty cents. 
In point of fact the average price combined of the respective articles 
was less than this, and probably did not exceed twenty-eight cents. 
In order that the true relation of these figures may be comprehended 
the accompanying diagram is submitted. 




In this diagram the classes of workmen are indicated by the Roman 
numerals I., II., III., and IV. The number of portions which each 
year's earnings would buy is given on the vertical lines under the re- 
spective dates. The relative progress of each class of workmen is 



Progress and Poverty. 1 7 1 

indicated by the lines projected from left to right, I., II., III., and IV. 
The line indicated by the numeral V. gives the purchasing power of 
$100 of lawful money at the several dates in portions of the multiple 
standard. The line which passes diagonally from left to right, marked 
" Decline in rate of interest," indicates the loss in the purchasing 
power of capital. The line at the top, indicated by the Roman 
numerals VI., indicates the purchasing power of the income yielded by 
an investment of $10,000, at the respective dates. Let us now glance 
at the relative conditions of labor and capital disclosed by this diagram. 
-The gain in the purchasing power of wages, measured by the mul- 
tiple standard of food, fuel, and cloth, has been from i860, as com- 
pared to 18S5 and 1886, as follows : 

Class 1 70 per cent. I Class III 40 per cent. 

Class II 59 per cent. I Class IV 43 per cent. 

The gain in 1885 and 1886, as compared to the year 1865, when 
paper money and war had exerted their utmost effect, was as follows : 

Class I..... 108 per cent. I Class III 78 per cent. 

Class II 90 per cent. j Class IV 67 per cent. 

The line indicated by the numeral V. gives the purchasing power 
of one hundred dollars of lawful money, in specie in i860, in depre- 
ciated paper currency up to 1879, and again in specie in 1880, 1885, 
and 1886. In i860 one hundred dollars of coin would buy 323 por- 
tions of food, fuel, and materials for clothing. In 1865 one hundred 
nominal dollars of depreciated paper would purchase only 179 por- 
tions, a loss of 44 per cent, in the power of the money, which was 
partly compensated to workmen by a moderate advance in the rate of 
wages. In 1885 and 1886, one hundred dollars of coin would purchase 
Z2>Z portions at the estimate assumed by me, 30 cents per portion, but 
in fact, nearer 350 portions of the same kinds and quantities of the 
necessaries of life at a somewhat less price, say at 28 cents. The line 
sloping diagonally from left to right shows the reduction in the earning 
power of capital as demonstrated by the fall in the rate of interest on 
the best classes of securities. 

From 1848 to i860 the writer kept a record of transactions by 
himself or by his associates in manufacturing corporations. The 
average rate of discount paid in the open market by the corporations 
enjoying the highest credit during this period was eight per cent., 
subject to very considerable fluctuations. From i860 to 1869, inclu- 
sive, the rates of discount varied greatly with the circumstances of 
each case. The war and the continued issue of legal-tender notes 
rendered any standard of little moment. Railway corporations 
issued bonds at long dates, at rates of interest from 7 to 8 per 



I 72 



The Industrial Progress of the Nation. 



cent., but there was little recourse to credit in ordinary transac- 
tions. Commercial paper wholly disappeared and all traffic in goods 
assumed the nature of barter, no one holding money longer than was 
necessary. In 1870 the slow restoration of specie payment began. 
Up to 1873, the year of panic, the rate of interest on the best manu- 
facturing notes was on the average six and one half per cent. 

After the panic of 1873 ended, up to the ist of January, 1879, five 
per cent, was the average rate. Since the restoration of the specie 
standard at the latter date, down to the present time, the fluctuations 
in the rate of discount on the very best commercial notes have been 
from 3 to 5 per cent. ; by the actual record of a broker doing a very 
large business, they have averaged 4 per cent, on 6 months' paper in 
this section of the East. 

By the kindness of Mr. Lyman J. Gage, of Chicago, I have ob- 
tained the rates of discount on commercial paper at that point. They 
are about the same in their proportion, having been reduced from an 
average of 10 per cent, or over, to an average of 5 per cent, or less, 
between the dates i860 and 1886. On Western farm mortgages the 
change has been much greater. Twenty-five years ago rates as high as 
25 per cent, were paid on mortgages of Western land, on what has 
proved to be excellent security. The rate now charged is seven per 
cent, and even less. 

In order to determine the actual earning power of capital safely 
invested, it becomes necessary to combine the several factors : first, 
rate of interest ; secondly, income of a given sum at that rate ; thirdly, 
purchasing power in portions of the products included in the multiple 
standard. Assuming ^10,000 invested, yielding the average rates of 
interest given above, we get the following results in the income and 
purchasing power : 



i860 Income 


$800 spent 


at 30/5% 


cents per portion. 


. . . 2584 portions. 


1865 


$800 " 


" 55tVit 




.. . 1436 


1870 


$700 " 


" 43TVxr 




. . . 1603 


1875 


$600 " 


" 38tVt7 




••• 1551 


1880 


-$500 " 






. . . 1500 " 


1885-86 " 


$400 ' ' 


" 30 




••• 1333 



I have chosen Eastern rates rather than Western. In 1865 rates 
fluctuated greatly, but I assume no average change from i860. 

If capital could only secure by its income one half as many por- 
tions of food, fuel, and clothing in 1885 and 1886 as in i860, and if in 
the meantime the productive power of labor had become one third 
more effective, which is a moderate estimate, does it not follow that 
labor now secures the service of capital on better terms than ever be- 
fore ? I submit this problem in economic mathematics to the officers 
of the Anti-Poverty Society. 



Progress and Poverty. 



I o 



It is because these facts are consciously or unconsciously compre- 
hended, that the agitation of what is called the labor question affects 
but a small fraction or fringe of the working population, and that the 
special efforts of the leaders to change the relations of workmen and 
employers last so short a time and have such slight results. On the 
other hand, the more the workmen organize and discuss these problems, 
the more fully will the true relations of labor and capital become defined. 

Now, while I cannot claim positive accuracy for these formulae by 
which I have attempted to present the problem of distribution, I can 
feel well assured that the margins for error would balance each other, 
and that even if the figures are not absolutely true, the curves by 
which the relative condition of laborers and capitalists are indicated are 
so near to absolute truth as to make any error in detail of no apprecia- 
ble effect upon the general result. May it not therefore be held that, 
in a free and substantially homogeneous country like the United States, 
society adapts itself to whatever conditions may be brought into effect 
by war, by paper money, or by fiscal legislation ? 

In order that society in a broad sense may exist, the division of 
labor and the exchange of product for product or of service for ser- 
vice is an absolute necessity. In the distribution of products, in 
which the exchange of service mainly consists, there may be more or 
less friction. When the standard of value or money of the country is 
tampered with, there will be a greater margin of profit secured by 
capital as against labor, in order that capital may insure itself against 
loss from the depreciation of the money in which it is rated. Yet 
good or bad as the money may be, or costly, unscientific, and ill-ad- 
judged as the system of taxation may be, the discoveries of science 
and the labor-saving inventions applied to productive industry bring 
forth or produce, if they do not create, a huge abundance where 
scarcity had been the rule. Under the higher law which governs 
society, the direction of which can be but little changed by legislative 
interference, the benefit of this abundance is ultimately distributed, to 
the end that those who do the work of production and who are classed 
as working men and working women, secure to their own use an in- 
creasing share of a constantly increasing product. This product is 
divided among themselves in the exact proportion to which their rela- 
tive capacity and ability entitle them. On the other hand, the owners 
of capital, or those who direct its force, secure to their use or enjoy- 
ment a diminishing share of this same constantly increasing product. 
Yet such has been the enormous gain of the last twenty-five years by 
the application of numerous inventions, that this smaller share of a 
vastly increasing product represents at this time a larger aggregate of 
wealth than was ever attained by any people of any country at any 
previous period of the history of the world. 



1 74 The Industrial Progress of the Nation. 

The prime factor in the progress of the people of the United States,, 
both in personal wealth and in general welfare, has been the develop- 
ment of the railway system. The service of the railways has continued 
to increase with great rapidity during the last two years, while the price 
of that service continues to be reduced. The twenty-six great systems 
of railway which centre in Chicago from east and west received in the 
last four years a little less than $640,000,000 for moving food, fuel, ma- 
terials for shelter, and clothing, at the rate of less than a cent (0.854c.) 
a ton a mile. The charge for the service of these same railways from 
1866 to 1873 averaged 2.315 ; the reduction in the rate of the last four 
years has been 1.461 cents a ton a mile. Had the traffic for these four 
years been charged this difference, or been charged what was consid- 
ered a reasonable rate in the former period, the cost would have been 
$1,091,000,000 more than it actually was. The service of these trunk 
lines constitutes thirty-five per cent, of the whole railway service of the 
country ; the reduction in the railway charge on all lines has been as 
great or greater than on these (in all more than $3,200,000,000) for the 
last four years. While the mass of the people have thus gained in the 
aggregate more than $800,000,000 a year in the cost of distribution in 
recent years as compared to the period previously named, the construc- 
tion and operation of the railways have been the source of many of the 
phenomenal fortunes of recent years. Of some of these fortunes it may- 
be truly said that every dollar which has been gained by their owners 
is but a token of the service which they have rendered to" their fellow- 
men ; of others it may be as truly said that each dollar of their gains 
is but a token of theft, fraud, and corruption. It may be that some 
of the most conspicuous representative men in the railway system, hav- 
ing corrupted the judge of a high court, are now in the position of out- 
laws, incapable of being trusted, and subject only to the execration of 
their fellow-men ; yet good or bad as may have been the origin of these 
great fortunes, the railways themselves, under the higher law which 
controls all the exchanges of men, and in spite of injudicious and 
restrictive legislation, continue to do their work with ever-increasing 
benefit to those who consume the products which are moved upon 
them. 

I have thus endeavored to show how the great economic forces 
which have so recently come into action are steadily working out a 
greater equality in the distribution of the abundant product which they 
have brought into existence ; yet great as this progress is, it doth not 
yet appear what it shall be even in the near future. A wholesome dis- 
content now pervades all classes of the community, from which true 
progress will be evolved in spite of the obstructions of the anarchist 
and the socialist and the empirical devices of economic quacks and 
agitators. 



Progress and Poverty. i 75 

Steam and electricity have profoundly changed all the relations of 
men. The old order of personal intercourse between master and 
workman is gone. The small self-contained community in which there 
were none very rich and none very poor has almost disappeared. The 
new forms of society are not yet shaped or moulded. The one thing 
most needed now is that the rich men shall know how the workmen live, 
and the workmen shall know how the rich men work. 



IV. 

THE PROGRESS OF THE NATION.* 

IN the three previous articles in the Forum I have endeavored to 
present facts which prove : 

First. How small a proportion of each year's annual product 
is or can be added to the capital of the country ; not exceeding ten per 
cent, in a normal year. 

Secondly. How rapidly this annual product has been increased in 
recent years both in quantity and in gross value, accompanied by a 
wider and cheaper distribution, resulting in a constant advance in the 
standard of common welfare and of common comfort. 

Thirdly. I have given the data tending to prove that although the 
additions to capital or wealth constitute a diminishing share of an 
increasing product, yet such has been the rapidity in the increase of 
this gross product as to have brought the accumulated wealth of this 
country at the present time to an amount greater in proportion to popu- 
lation than it ever was before, small in proportion to the total product 
as the annual increment of added capital may be. 

Fourthly. From these facts I have deduced proofs of the proposi- 
tion, that as capital becomes more effective it secures to itself either in 
the form of rent, interest, or profit, a lessening proportion of the 
increased annual product ; or, to put the case in another form, as 
capital becomes more abundant, as well as more effective, it is placed 
at, or worked in, the service of labor for a lower rate of compensation, 
or for a diminishing share of the joint product of labor and capital. 

Fifthly. As labor becomes more skilful and therefore more effec- 
tive, and is at the same time more intelligently directed in its application 
to production, workmen secure to themselves an increasing share of a 
larger and larger product ; or, in other words, workmen attain larger 
earnings by their ability to make goods or to perform services of any 
kind at a constantly diminishing cost. This gain in efficiency and 
therefore in earning power, is attained by workmen in just proportion 
to the development of the individual capacity of each man or woman. 
The condition on which individual capacity leads to personal welfare 

^ Reprinted from the Foriun. 



The Progress of the Nation. i 7 7 

is, of necessity, that all men and adult women shall retain their personal 
control over their own time and their own work. If they are restricted 
in making their personal agreements or bargains either by State laws 
limiting the freedom of contract or by the by-laws of associations in 
disposing of their time, or if they are restricted in the personal control 
of their own methods of work, the earnings of the most skilful may be 
reduced to the average of the least capable. 

Tt also begins to be apparent that since the wage fund is that part 
of the annual product, or its value in money, over and above the lessen- 
ing proportion which may and must be devoted to the remuneration of 
capital or to taxation, the power of the workman may be said to grow 
by what it feeds upon. In proportion as the workman raises his stand- 
ard of comfort and welfare, he develops in the very mental conception of 
and in the desire for that higher standard, an increasing power to attain 
it ; thus his increasing share of an increasing product becomes the base 
for the attainment of a yet greater increase. 

It has been well said that the true measure of civilization consists 
not so much in the standard of living which is actually attained by com- 
mon laborers, as in the standard which is intelligently set up by them as 
the mark of their attainment. The truer the standard aimed at, the 
greater will be the power developed to secure it. Our mother earth 
stands ready to yield an unmeasured abundance of the means for mate- 
rial welfare, and will respond to productive labor in exact proportion to 
the intelligence \yith which the work is directed ; therefore with the 
development of the mental as well as the manual or mechanical capacity, 
higher earnings becomes the correlative of a reduced cost of produc- 
tion. For instance : there is almost an exact correspondence between 
the supply of food and the power of doing the work by which the food 
is supplied. The Western prairies yield more meat and bread than the 
people of this country can possibly consume. The power of the rail- 
ways to distribute this food is in excess of the quantity waiting to be 
distributed. Let these two forces or instrumentalities of production 
and distribution be freely developed according to the opportunity, and 
it will follow of necessity that each person will obtain the largest sup- 
ply of food at the least cost. But if there should arise a prejudice 
against the railway managers such as to lead to obstructive interference 
at the demand of the majority of voters, then it must follow that the 
cost of distribution will be increased, the stimulus to production will be 
diminished, and the supply of food will be proportionately cut off until 
intelligent methods shall take the place of ignorant prejudice. 

Again : a large part of the labor of Europe is rightly named *' pau- 
per labor." It is under-fed ; it is ineffectual and costly because it is 
under-fed ; the one condition is a complement of the other. Why is it 

under-fed ? It is not because there is not land enough in Europe to 
12 



I 78 The Industrial Progress of the Nation. 

sustain every inhabitant with a full supply of food. The reason is quite 
different. The masses of Europe are too ignorant to throw off the bur- 
den of dynasties and standing armies and navies ; they permit the sup- 
ply of food to be obstructed, and also permit so large a part of that 
which is produced to be devoted to the destructive purposes either of 
preparation for war or of active war, that what is left will not suffice for 
either adequate nutrition or for the comfort or the welfare of the work- 
man ; neither will it suffice to enable him to do the most effective work; 
therefore he tends to become a pauper. It is not, however, the purpose 
of the writer to deal with these broader aspects of this question. It is 
his present purpose to show that if the lives of either rich or poor in 
this country are still ignoble, it is not for want of the means for a better 
life. We shall hear less of classes among men, and we shall not be 
obliged to sort them into classes, when the true purpose of living is bet- 
ter comprehended than it is now by rich and poor alike. 

It is necessary to true welfare that the mental capacity and power of 
direction of the capitalist or his agent .shall be recognized as a prime 
factor in production, especially by those who attribute abundance to 
the mere application of mechanical or manual labor to the work. There 
are admitted evils in the present age of machinery which are brought 
about hiy the extreme subdivision of labor, even though these processes 
are absolutely necessary to the production of that abundance without 
which the present general standard of living could not be set up even 
as the mark of future attainment. Yet out of this abundance even the 
dream of the eight-hour agitator may ultimately become a reality, but 
this attainment will be near at hand only when the workmen themselves 
comprehend that leisure is secured through liberty and not by way of 
restriction. This is only the first century of commerce in any true 
sense, and the bearing of steam and electricity upon civilization is as 
yet but dimly apparent ; their effect in shortening the necessary hours 
of work and in alleviating the adverse conditions under which so many 
common laborers now merely exist, has hardly begun. 

It is admitted that, co-incidently with the great progress from pov- 
erty which has been brought about by the very rapid application of in- 
vention to production and distribution, the conditions under which the 
work of the country is carried on have been profoundly changed ; there 
has therefore ?jeen at times great difficulty on the part of unskilled 
laborers in finding steady occupation, while there has also been more 
or less difficulty in adjusting themselves to new conditions on the part 
of persons whose occupations, requiring special skill and aptitude, have 
been done away with wholly or in part by the use of machinery. These 
difficulties have, however, been exceptional ; the general influence of 
all the changes referred to has been in the direction of lower prices, 
small profits proportionately to each transaction, accompanied by 



The Progress of the Nation. i 79 

higher wages to those who do the primary work of production and 
distribution. 

As the margin of profit has diminished, a higher order of intel- 
ligence, a much closer method of business, and a more strict applica- 
tion of science have been called for in all large undertakings. There- 
fore, while the earnings of workmen have increased, the earnings of 
those who have been charged with the direction and application of 
capital have also increased, possibly even in inverse proportion to the 
lessening ratio of profit on which the remuneration of capital depends, 
while mere possession of capital has become less and less remunerative 
to the owner. Thus the work of the director or administrator of capi- 
tal, whether its owner or agent, has assumed a position of supreme 
importance. 

It may also be observed, that while great fortunes, even those 
which have been gained by theft and fraud or by gambling in the 
stock market with loaded dice and marked cards, have become more 
conspicuous, they yet bear in the aggregate a lessening proportion to 
the total savings of the community. It may not be a subject capable 
of absolute proof, but it may be safely held that the wealth of the 
country is more widely distributed than ever before. In respect to 
distribution by fraud and gambling it is also to be remarked, that no 
one need trust or deal with an outlaw who has corrupted the courts 
of the country, unless he chooses to do so, and that no lambs will be 
shorn who do not offer* their own fleeces to the wolves. 

Again it may be remarked, that as the margin of profit diminishes, 
the so-called system of co-operation or profit-sharing becomes more 
impracticable, and also less desirable as a mode of distribution. Co- 
operative distribution has had some success in Great Britain, where a 
credit system has long ruled even in the retail traffic of towns and cities, 
but it has had little success in this country, where the principle of 
large sales at small profits, for ca.sh or its equivalent, has long been in 
operation in the great retail shops. 

A glance over the figures of production and distribution will per- 
haps remove doubts as to these propositions, and may help in their 
comprehension. The great gain and the increase in consumption in 
recent years have been chiefly in the consumption of articles which 
are of common use by the great mass of the people, rather than in 
luxuries or articles of voluntary use. (Here we set aside for separate 
treatment the consumption of spirits, wines, and fermented liquors.) 
It is because so large a part of the industry of this country is applied to 
the production and distribution of the necessities and comforts of life 
that they become the subjects of paramount importance in the study 
of questions that are now at issue ; this fact also renders the alleged 
tendency to luxurious consumption and waste relatively unimportant. 



i8o The Industrial Progress of the Nation. 

If we take as a starting-point the year 1870, when the armies on 
both sides of the civil conflict had become finally absorbed in the pur- 
suits of peace, when the difficulties of the reconstruction period were 
mainly ended, and when the revolution not only of institutions but of 
ideas in the Southern States was so nearly completed that the whole 
country, as a unit, had entered upon an era of great material progress, 
we find that while the population increased from 1870 to 1887 only 55 
per cent., the product of hay, which is synonymous with meat and the 
products of the dairy, increased from 70 to 80 per cent.; the product 
of grain, 85 per cent.; the product of cotton, 112 per cent.; the con- 
sumption of wool, domestic and foreign, nearly 100 per cent.; the 
product of pig-iron, 285 per cent ; the construction of railways, 223 
per cent.; and so on in varying proportions, all in excess of popula- 
tion, with regard to all the necessities and comforts of life. 

If the consumption of liquors be considered separately, the facts 
show that the consumption of champagne, expensive wine, brandy, 
and the like, is very small compared to that of beer and whiskey, or 
the drink of the every-day working people. The most complete and 
accurate estimate of the consumption of liquors has been made by Mr. 
F. N. Barrett, editor of the American Grocer, whose conclusion is that 
on the average, from 1883 to 1887, the consumption of spirits, beer, 
and wine cost the consumers a little less than ^768,000,000 a year. 
Of this consumption, domestic spirits, domestic beer, and domestic 
wine amounted to $734,000,000, leaving only the remainder, $34,000,- 
000, to cover foreign wines, spirits, and beer ; less than five per cent. 

It thus appears that the increasing supply and consumption of 
commodities of domestic and foreign origin have consisted mainly of 
those articles which enter into general consumption, and which are 
either the common necessities or the comforts of life ; or, if spirits 
and beer may be called luxuries, the luxuries of the common people. 

It follows of necessity that since there has been no accumulation 
of stock, and since all that has been produced or imported in exchange 
for the export of the domestic products has been consumed, the gen- 
eral consumption of the mass of the people must have been g.reater, 
more adequate, and more satisfactory than ever before. Yet in this 
period from 1865 to the present time, we have had several commercial 
crises, panics, and periods of alleged depression in trade and industry, 
recurring oftener than in former times, accompanied by want of em- 
ployment for a considerable number of workmen, especially common 
laborers, who feel the depression first and who are least capable of 
waiting for work on the proceeds of which they may subsist. 

It may also be observed that while the general tendency of prices 
throughout this period has been downward, there have been sharp 
and not infrequent upward fluctuations, or, according to the new 



The Progress of the Nation. 1 8 1 

term, there has been a "boom" in trade and commerce. These new 
and varying conditions lead once more to the study of prices or to the 
determination of the very obscure question, What makes the price of 
goods ? They also bring up the question, What is the actual connec- 
tion between price and money, the latter considered quantitatively and 
qualitatively ? Whether or not these problems will ever be deter- 
mined in such a scientific way as to make the solution a part of the 
common knowledge or of the common-sense of the community, is a 
matter that cannot yet be decided. The utmost that can now be done 
is to treat, perhaps somewhat empirically, some of the forces that affect 
prices directly or indirectly by their influence upon the exchange of 
products, on which the salable value depends. 

Among the major forces promoting abundance and tending to 
increase the value of the annual product and thereby of the wage and 
profit fund, may be named improvements in the methods of banking, 
the telegraph, the extension of the railway and steamship service, with 
a reduction in the charge, and the opening of the Suez Canal. 

Among the lesser forces which have tended to obstruct the ex- 
change of products and thereby to reduce the general wage and profit 
fund and to affect prices, the war of tariffs may be named, by which 
the peaceful benefits of commerce are interrupted. In Europe these 
barriers of taxation, dividing the several states and nations of the 
Continent, maintain animosities of race, creed, and nationality. The 
customs revenue, being an indirect form of taxation, is kept up to 
the deception of the people who are oppressed by it. It is said to be 
necessary to the support of the several states by which these duties are 
imposed ; in fact, upon the Continent an analysis of the revenue and ex- 
penditure of onlv a few states proves that a sum exceeding $350,000,000 
a year is collected from customs at these barriers, and a sum exceed- 
$500,000,000 a year is annually wasted in the support of standing 
armies and navies, which would not be required or tolerated if these 
barriers were leveled or removed. This evil is very much diminished 
and is of little effect in this country, except so far as the tariffs of 
foreig-n countries obstruct the import of our grain and other articles of 
food, for the reason that the continental system of absolute free trade 
throughout our whole country, covering a larger area and benefiting a 
greater number of people than ever before enjoyed absolute freedom 
from trade restrictions, has assured our progress in spite of all obstruc- 
tions to our foreign commerce, which is relatively unimportant. 

The main purpose of the present treatise is to consider only one of 
the forces which have in recent years exerted a great influence upon 
prices, and through prices upon the rates of wages, to wit, the currency 
or circulating medium of the country. (I hesitate to use the word 
''money " in connection with mock or substitute money, viz., the legal- 



1 82 The Industrial Progress of the Nation. 

tender notes of the government, which, under a fiction of law, have 
become fiat money, and have been forced into circulation in place of 
true money, which carries its own value in its own substance.) 

The advocates of fiat money, or unlimited paper money, attribute 
great importance to the volume or quantity of money or instruments of 
exchange in circulation. On the other hand, prior to the resumption 
of specie payment, the advocates of the specie standard, whether the 
single or so-called double standard, considered the quantity of circu- 
lating medium a most important factor ; they believed that the 
contraction of the circulating medium or of legal-tender paper money 
would be required in much greater measure than actually occurred, as 
a necessary precedent to the resumption of specie payment. 

It must be admitted by every one who gives any weight to facts, that 
the issue of legal-tender notes during the war was accompanied by great 
depreciation and by much greater advance in prices than in the rates 
of wages ; consequently the great mass of working people suffered great 
harm, which was in part compensated to them by the excess of demand 
for their products and services for war purposes. This was proved in 
the last article. 

But who can measure the relative importance of the quantity or 
volume of the notes issued, as compared to their discredit or the doubt 
of their ultimate payment during the dark period of the war ; or who 
can measure the effect on prices of the demand of the war itself upon 
the labor of the country, either in the military service or in supplying 
the armies ? The actual work of war is and must be done during the 
war period ; payment for such work by way of taxation may be in part 
deferred until either the bonds due at long date or the demand notes 
issued under a legal-tender act become payable. 

It is somewhat difficult to conceive the measure of the actual work 
of the war. From April, 1861, to June, 1868, four years of war and a 
little over three years of reconstruction under military rule, the revenue 
of the United States was : 

From taxation, sales of public lands, and from miscel- 
laneous sources $2,213,349,486 

From loans which were unpaid June 30, 1868 2,485,000,000 

$4,698,349,486 
The expenditures of seven years of peace at a consid- 
erably higher rate than in previous years might 
have been $698,349,486 

Leaving the money cost of war to the nation $4,000,000,000 

But to this must be added the war expenditure of 

States, towns, and cities. I am not aware that 

this has been separately compiled ; it must have 

been at least $1,000,000,000 

Making the cost of war to the nation as a whole (in 

money or debt) $5,000,000,000 



The Progress of the Nation. 183 

But again, to this sum must be added the waste of property, of 
time, and what little capital there was in the Southern States, which 
cannot be estimated at less than three fifths the expenditure of the 
North, or $3,000,000,000. The waste in the South has perhaps been 
more rapidly made up than the cost to the North, by the abolition of 
slavery and by the emancipation of whites as well as of blacks from its 
degrading effects ; witness the subsequent enormous growth of all the 
varied arts and industries in the South, to which liberty has given place 
and opportunity. 

It may be assumed that at a minimum the cost of suppressing the 
Rebellion, which was promoted by the little oligarchy who made use of 
the slave power to mislead and deceive the masses of the people of the 
South, by making them believe that slavery and State rights were con- 
sistent with and were bound up in each other, was $8,000,000,000. The 
cost of establishing and maintaining national liberty and State rights in 
a true sense throughout the land, was therefore $1,135,000,000 a year 
for seven years. This price in terms of money represents so much 
actual work done, mainly by the privates of both armies and by those 
who supported them. 

It has been held that the maximum product of each person occupied 
for gain in 1880 could not have exceeded $600 worth. Labor and capi- 
tal were at least one third more effective during and since the year 1880 
than during the period of war and of reconstruction. If then we value 
one man's labor from 1861 to 1868 inclusive at $500 a year, the work 
of war required the unremitting labor of 2,270,000 men for seven years, 
either in the two armies or in sustaining them. At $400 each, an 
estimate probably nearer to the mark at that time, the measure would 
be the constant work of 2,837,500 men for seven years. The average 
population of that period was 35,000,000, of whom not over one in five 
could be considered an able-bodied man of arms-bearing age. 

The cost of liberty therefore consisted in actual arduous work 
at the risk of life for seven years, of one man of arms-bearing age 
in every three. More than one third of the price of this work of war 
was deferred by borrowing ; y6t such was the enormous increase in 
production and the facility for distribution brought about by the unifi- 
cation and completion of the railway system of the North, which took 
place at about the beginning of the war, and such was the effect of the 
rapid application of inventions and improvements, especially in agricul- 
ture, during this period, that not one single Northern crop diminished, 
and not one single art or important branch of industry, except cotton- 
spinning, failed to increase. Therefore, as soon as the disbanded 
armies were absorbed in the pursuits of peace, production went 
forward with leaps and bounds, while foreign markets took our excess 
in payment for our foreign loans ; our bonds were rapidly returned to 



184 The Industrial Progress of the A^ation.. 

us by purchase. In 1S76 and 1877 the tide of foreign coin set toward 
this country, and the resumption of specie payment became possible on 
the ist of January, 1879. 

In the latter part of this same period the wonderful development in 
Southern industry also occurred, than which there is no more extra- 
ordinary chapter in all economic history. That section of our country 
which had been devastated by the war, its capital destroyed, its former 
system of labor completely overturned, its people left to recover with- 
out inherited aptitude, mechanical appliances, or any other of the con- 
ditions which have been assumed to be necessary for success in 
diversified industry, is now dotted all over with factories of various 
kinds, and crossed and re-crossed by a rapidly extending railway sys- 
tem, Avhile its mines and iron-works are threatening those of the older 
States ; yet more important, all the lesser arts of civilized life which go 
to make towns and cities are springing into existence. All this has 
been done in spite of the free and urgent competition of the Northern 
States, with all their capital unimpaired, their inherited aptitude, and 
their fully-developed mechanical appliances. Thus while the South 
(which previous to the war had depended mainly upon the North not 
only for manufactured goods, but for bread and meat, wasting its mis- 
directed slave labor by its application almost wholly to cotton, rice, and 
sugar) has now become almost self-sustaining, its crop of cotton has 
become more and more a money crop, representing its surplus of agri- 
culture or the means for a better subsistence than in the bad old times 
of the past. The North, thus deprived of a part of the great Southern 
market which it formerly enjoyed, while its own crops were rapidly in- 
creasing in ratio to its population, has found it more and more neces- 
sary to open a foreign market for the food which could not be cour 
sumed at home, and which might have rotted upon the field except it 
could have been exported. 

The reduction in the railway charge, taken by itself, may fully ac- 
count for the rapid increase in the export of grain, by means of Avhich 
we more than balanced our import and paid our foreign debt. But 
there is a yet more subtle element to which attention might well be 
called. The value of the imports of merchandise over and above our 
exports, from 1866 to 1875 inclusive, was in round figures $817,000,- 
000. The value of our exports of merchandise above our imports, from 
1S76 to 1885 inclusive, consisting wholly of the products of agricul- 
ture, was $1,574,000,000. 

On what elements did this depend ? The railway charge upon the 
twenty-six great systems of railway which diverge from Chicago east 
and west, from 1866 to 1875, was 2.1837 cents per mile ; from 1876 to 
18S5 it was 1. 1037, making a saving of 1.08 on the traffic of these 
specific lines, on which 35 to 40 per cent, of the whole railway service 



The Progress of the Nation. 185 

of the country was performed ; yet this difference in the rate of charge 
on these specific lines only, from 1876 to 1885 inclusive, came to more 
than $1,700,000,000, as compared to the rate charged in the previous 
ten years. This saving alone more than accounts for the excess of our 
exports over our imports, which excess enabled us to redeem our 
bonds or to import the coin necessary for our use. 

But the yet more subtle element is this : The self-binder was first 
successfully attached to the reaper in 1876. From 1867 to 1876 inclu- 
sive our average crop of wheat, varying more with the season than with 
the planted area, had been 258,000,000 bushels. In 1877, when the 
self-binder first began to be used, the crop mounted to nearly 364,- 
000,000 bushels. Again in 1878 it mounted up ; and from that date 
to 18S7 inclusive, in which period the use of the self-binder had become 
general, the average crop, varying more with the season than with the 
planted area, was 440,000,000 bushels. Could the crops of the last ten 
years have been saved without the self-binder ? 

When we consider the fact that in the United States the adoption 
of each harvester did away with the work of seven or eight men, who 
had previously been required to bind the crop by hand during the 
short harvest season ; when we consider also that the total number of 
self-binding- reapers now made and sold is more than 100,000 a year, 
requiring over 30,000 tons of twine to bind a single wheat crop, at this 
date 1889, over 50,000 tons, do we not find in the tying of that knot on 
the self-binding harvester a main factor in the export of grain with the 
returning import of gold, on which we resumed specie payment ? By 
that single improvement the cost of wheat was reduced not less than 6 
per cent., and in some places 10 per cent. We may also find in this 
little knot one of the most potent factors in the displacement of 
unskilled labor. 

There is an intimate connection between these forces and the 
currency question. The financial danger of this country came imme- 
diately after the war ended, when the expenditures were at their maxi- 
mum and the income had not reached its full measure. The green- 
back craze pervaded the country, and the welfare of the people was 
held to depend rather upon the quantity than upon the quality of the 
circulating medium. At that date there had been no record in history 
of any country which had paid a great war debt, or of any country 
which, having issued its own notes and having made use of them under 
a legal-tender act for the purpose of collecting a forced loan, had 
afterward redeemed or paid them in coin according to promise. Few 
there were at that time who had firm faith either in the redemption of 
the notes or in the speedy payment of the debt. 

The great war debt incurred and entered upon the books of the 
nation on the first of August, 1865, amounted to $2,674,815,856. To 



1 86 The Industrial Progress of the Nation. 

this sum the Secretary of the Treasury, Hon. Hugh McCulloch, in his 
last report, added for debt due August i, 1865, but not audited and 
entered, the sum of $322,574,347. The maximum debt of the United 
States was therefore $2,997,386,203. It has since been reduced to 
$1,500,000,000, or from $84 to $18 per capita of the population. Sept. 
I, 1889, $1,083,740,625. 

The writer was apparently the iirst to prove, in an address to the 
Republican Convention of Massachusetts, September 19, 1868, that if 
the per capita taxation of the United States were maintained at the rate 
then imposed, $8.60 a year, the whole debt would be paid before Jan- 
uary I, 1885, as it would have been had not the average rate of taxation 
per capita been somewhat reduced. Its final payment has been 
deferred a little longer by a reduction of annual taxation to about 
$6.00 per capita, of which nearly $2.00 is now applied to the payment 
of the debt. There will probably be no Congress that will dare reduce 
taxation in sufficient measure to prevent payment of the last dollar of 
the national debt before the end of the century. 

During this period, from i860 to the present time, the quantity of 
the circulating medium, consisting of coined money or redeemable 
bank-notes or other substitutes, or of legal-tender notes which under a 
fiction of law have taken the place of true money, has varied, as shown 
in the table on the opposite page. 

Through the courtesy of the Secretary of the Treasury I am per- 
mitted to give this table showing the total amount of money, or of the 
instruments of exchange in use as money, consisting of coin, legal- 
tender notes, convertible bank-notes, or other instruments of exchange 
in use at the several dates given, computed per capita in ratio to the 
population each year. Absolute accuracy is not, as I understand, 
claimed for this table, but the estimate is as close to the mark as it is 
in the power of the Treasury Department to compute it. 

It will be observed that even if the present tendency of the surplus 
revenue is to cause all the United States notes to fall into the Treasury 
without re-issue, and even if it should end in the liquidation by way of 
taxation of all that part of the circulating medium which now consists 
of United States legal-tender notes which are not already in the 
Treasury or covered by coin in the Treasury, and the circulation or 
volume of what passes for money should be contracted to that extent, 
there would nevertheless remain in circulation in coin, in gold and 
silver certificates, or in convertible bank-notes, a sum per capita sub- 
stantially the same as that of the year 1880. It will be remembered 
that the year 1880 was a year of more than normal prosperity. May it 
not therefore be inferred that the country is now rich enough and 
strong enough to pay its demand debt, represented by the legal-tender 
notes, and to withdraw those notes from circulation without any 



The Progress of the Nation. 



187 



appreciable effect either upon prices, wages, or credits ? If such be 
the fact, delay in reducing the so-called surplus revenue by reduction 
of taxation may, so far as its effect upon the circulating medium is con- 
cerned, work no injury but rather a benefit. 

The table on page 188, showing the relation of prices, wages, and 
purchasing power and quantity of the circulating medium, is given in 
order to sustain this view. It will be interesting to observe, in the con- 



TABLE SHOWING, FOR THE UNITED STATES, THE POPULATION, TOTAL AMOUNT 

OF MONEY, AND THE AVERAGE AMOUNT PER CAPITA YEARLY, FROM 

i860 TO 1887 INCLUSIVE. 







Total amount of money, exclusive 








of legal tender, gold, and silver 






Population. 


certificates.* i860 to 1872 inc. 


Average Amount of 


Year. 


(Prof. Elliott's Tables.) 


taken from Fin. Rep. of 1886 ; 
1873 '° 1887 inc. taken from Fin. 
Rep. of 1887. 


Money per Capita. 


i860 


31,443,321 


% 442,102,477.00 


$14.06030 


1861 


32,060,000 


488,005,767.00 


15.22164 


1962 


32,704,000 


532,832,079.00 


16.29257 


1863 


33,365,000 


623,100,168.75 


18.67526 


1864 


34,046,000 


1,062,840,516.50 


31.21778 


1865 


34,748,000 


1,180,197,147.76 


33-96446 


1866 


35,469,000 


1,068,065,785.96 


30.11266 


1867 


36,211,000 


1,020,927,153.52 


28.19384 


1868 


36,973,000 


888,412,602.75 


24.02869 


1869 


37,756,000 


873,694,101.61 


23.14054 


1870 


38,558,371 


899,875,899.48 


23.33802 


1871 


39,555,000 


894,375,751-06 


22.61094 


1872 


40,596,000 


900,570,903.52 


22.18373 


1873 


41,677,000 


891,211,673.94 


21.38378 


1874 


42,796,000 


939,225,887.17 


21.94658 


1875 


46,951,000 


914,149,629.69 


20.79929 


1876 


45,137,000 


904,849,434.89 


20.04673 


1877 


46,353,000 


922,160,168.84 


19.89429 


1878 


47,598,000 


989,845,159.27 


20.79594 


1879 


48,886,000 


1,056,232,698.11 


21.61488 


1880 


50,155,783 


1,207,827,059.70 


24.08151 


1881 


51,495,000 


1,371,688,001.65 


26.63731 


1882 


52,802,000 


1,431,411,868.18 


27.10905 


1883 


54,165,000 


1,494,404,497.14 


27.58986 


1884 


55,556,000 


1,503,129,680.64 


27.05612 


1885 


56,975,000 


1,553,246,868.21 


27.26190 


1886 


58,420,000 


1,577,191,425.52 


26.99746 


1887 


59,893,000 


1,649,149,915.37 


27-53494 



July 17, 1888. 



Jos. S. McCoy, 
Acting Government Actuary. 



' Gold coin, silver coin, and United States notes may be deposited in the Treasury under present 
laws, and certificates taken out which enter into circulation in place of the coin and notes thus 
deposited. 



The Industrial Progress of the Nation. 



sideration of this table, that the welfare of the workman has wholly de- 
pended upon the quality of the money in use, and not upon the quan- 
tity, again enforcing the principle that if we keep the quality of our 
money true the quantity will take care of itself. 

In respect to the data on which this table has been compiled, I beg 
to say once more, with regard to the rates of wages, that they have been 
averaged from a compilation of the figures given in the larger number 
of establishments treated in Volume XX. of the United States Census, 
those of which I have had some knowledge myself as to their having 
been in continuous operation throughout the period treated, or else 

RELATION OF WAGES, PRICES, PURCHASING POWER OF WAGES, AND VOLUME 

PER CAPITA OF MONEY OR CURRENCY IN CIRCULATION AT THE 

RESPECTIVE DATES GIVEN. 




No. I. — Average wages of mechanics, engineers, carpenters, machinists, and painters- 
connected with the mills and works treated in Vol. XX., United States 
Census ; establishments in Eastern, Middle, and Western States. 

No. 2. — Average cost of one day's supply of food, fuel, and material for clothing^ 
customarily used by such mechanics, computed at retail prices in 20 shops ; 
10 east and 10 west of Buffalo, N. Y. 

No. 3. — Purchasing power of 300 days' wages in equal portions of the same kinds of 
food, fuel, and cloth as above given. 

No. 4. — Quantity per capita of coin, convertible bank-notes, and legal-tender notes ia 
circulation or in use as money at the respective dates. 



Tlie Pj'ogress of the Natioii. 1 89 

such as from the nature of the work must have been fully employed 
throughout the whole period, being selected for the purpose. The 
rates are doubtless somewhat lower than would be shown by a compi- 
lation of figures given by mechanics themselves, engaged in analogous 
trades. This would always be the case if the wages of mechanics who 
are permanently employed in connection with factories were compared 
with those whose work is transient and not continuous throughout the 
year, owing to the nature of the occupations, as in the building trades. 
The rates of wages have also been compared with those computed on 
special investigations made on my own behalf, from typical establish- 
ments in the State of Massachusetts, which I know to be correct. 

With respect to prices, I had myself made averages of prices from 
data obtained by myself before Volume XX. of the Census was issued ; 
and by comparing my own data with those of the Census, I was able 
to verify the prices given in that volume for the Eastern States. . The 
number of portions assigned to 300 days' work of course assumes con- 
tinuous work, like that of the factory, which runs every working day in 
the year, omitting Sundays and holidays, customarily computed at 
three hundred days. 

The computation of money or currency per capita is as accurate as 
the official data of the Mint and of the Treasury Department will 
permit. The only issue which can be raised affecting it, is in regard 
to the quantity or amount of coin in the hands of the people. This 
subject has been a matter of considerable discussion ; suffice it to say 
that the absolute knowledge of the subject possessed by the Depart- 
ment of the Mint would substantially verify the proportions of currency 
per capita given in this table, even if the amounts did not absolutely 
correspond and were somewhat less. 

It may, therefore, I think, be safely assumed that the margins for 
error in these four computations are very small ; and if all errors were 
eliminated, while the figures might be slightly changed, the ratios or 
proportions would not be varied sufficiently to affect the general 
conclusion. 

In view of these variations in the quantity of money or currency 
in use at different dates, which bear no steady or uniform proportion 
either to the volume of trade or to the population of the country, it is 
apparent that the quantitative theory of the currency cannot be main- 
tained. May it not be held that confidence and credit have been 
greater factors in making prices than the quantity of the money or 
circulating medium of the countrj-, which is made use of directly only 
in the petty or retail transactions of trade ? Is it not the confidence 
engendered by the way in which we have overcome difficulties and 
dangers, that keeps our mixed currency at par -ndth gold at the present 
lime and that will enable us to surmount difficulties yet to come ? If 



IQO The Industrial Progress of the Nation. 

we keep the quality of our money good we may be sure that the 
quantity will take care of itself. 

The resumption of specie payment took place January i, 1879 ,' 
the fiscal year ends June 30th ; it is therefore more easy to make com- 
pilations from that date by calendar years. From July i, 1879, to 
July I, T887, the declared value of our net imports of merchandise was 
$5,640,261,758. In the same period the declared value of our exports 
of merchandise was 16,764,311,704. The true value of exports has 
doubtless been somewhat greater, as those which go by rail to Canada 
and to Mexico have not been accurately recorded ; the official reports 
of the Dominion of Canada and of Mexico prove them to be in excess 
of the value declared in this country. 

It will be apparent that such an enormous volume of exports 
could not have been sold for payment in money only, since the stand- 
ard of international commerce is coin or bullion. The coin which 
serves the purpose of international commerce is computed at the gold 
standard, there being no legal tender in international exchange. Such 
a demand for gold or gold bullion in sole payment for our exports 
would have drained every bank in Europe, and we should have no 
domestic use for such an amount of coin ; therefore unless an exchange 
of domestic for foreign products had been possible the export could 
not have been made. We could not have paid for our imports in coin 
only, nor could foreign countries have paid us for our exports in coin 
only. International trade must of necessity mainly consist in an 
exchange of goods for goods, the balance only being settled in gold. 
Had it not been possible to make this exchange, or to export the excess 
of our corn, wheat, dairy products, cotton, and oil, this excess could 
not have been consumed at home, as the remainder met the demand 
of the most abundant and increasing consumption ; nor could many 
of our domestic industries have continued without the import of crude 
or partly manufactured materials from abroad. 

This mutual dependence or interdependence of nations is too gen- 
erally admitted to make it worth while to waste time on the theories of 
a few incapable persons who advocate national isolation, with whom 
discussion is useless. The benefit of foreign commerce, under certain 
conditions, is fully admitted by every one. It may be admitted that 
the duties upon foreign imports give a different direction to domestic 
industry, but the effect, whether beneficial or otherwise, of our present 
system of duties, has been, in the opinion of the writer, very greatly 
exaggerated by the representations of both sides in the discussion of 
the system. When this becomes a part of the common conviction, the 
reform of the tariff, admitted by both parties to be necessary, may be 
entered upon by reasonable men without bitter contention, and with 
the simple purpose of adjusting the necessary revenue duties so as to 



The Progress of the Naiio7i. 1 9 1 

give the widest scope to the development of domestic industry, and to 
interpose the least obstruction to the exchange of product for product, 
in which our foreign commerce must, in the nature of things, consist. 

The point to which I desire to give prominence in this treatise is, 
that in spite of the depreciation and the fluctuations in the currency, 
and in spite of the ill-adjusted burden of taxation of all kinds which 
is now admitted by all parties, whether under a tariff, under the internal 
revenue system, or under State and municipal assessments, the effect of 
these minor forces has been but to retard in some measure the great 
progress of this country. Confidence and credit have been based on 
the progress which is assured by the application of invention and of 
science to human welfare ; these elements of commerce have far more 
than counterbalanced the blunders and stupidities of financial legisla- 
tion, and will ultimately force our fiscal system into harmony with the 
higher laws of material progress. 

If some of the computations presented in this treatise are already 
familiar to my readers, I can only justify their repetition by having 
brought them down to a later date. 



V. 

THE STRUGGLE FOR SUBSISTENCE.^ 

ONE of the most noticeable facts of the present day is the great 
and general interest in statistics. It is now admitted that 
every economic hopothesis must be tried by the test of figures 
to see if it coincides with the facts of life. It is also admitted that these 
figures must be compiled, sorted, and corrected by well-trained men 
and the work guided by their judgment, so that the figures may not lie. 
Both parties -in the national Congress have united in establishing the 
national Department of Labor Statistics, and more than half the States 
ha,ve established State bureaus. Not least significant among various 
incidents is the fact that special labor organizations are making ap- 
pointments of statisticians by whom the specific figures relating to their 
separate departments of labor may be compiled. After a few years 
there will be a basis for a true science of statistics such as has never 
heretofore existed ; it almost exists to-day, and from it a true science 
of inductive political economy may soon be evolved. 

By drawing from every source as yet available, the writer has 
recently presented statistics which cannot be gainsaid, proving, so 
far as figures suffice for proof, that greater progress than ever before 
has been made during the present generation, dating from 1865, when 
this nation first truly attained its independence, in providing for the 
means of subsistence, shelter, and clothing, and in organizing the ma- 
chinery for distributing the necessaries of life. Computations have 
also been given which go far to prove not only that since the dangers, 
difficulties, and destruction of the Civil War were surmounted and since 
slavery was abolished, there has been a more equal distribution of the 
necessaries of life among the masses of the people of this country, but 
also that there has been a more equitable distribution since the stand- 
ard of value of the country was re-established on a specie basis. 

No attempt has yet been made to compile or to compare the 
statistics of the hours of labor, but figures are not needed to prove to 
any one who has even a moderate faculty for observation, that the 
hours of labor as a whole have been diminished, while much of the hard 
hand work has been displaced by labor-saving mechanism. In the fac- 

' Reprinted from the Forum. 
192 



The Struggle for Subsistence. 193 

tory, either by way of legislation or in spite of legislation, it matters 
not which for our present purpose, ten hours have become customary 
in place of eleven or even twelve ; the usual hours of work in textile 
factories forty or fifty years ago having been thirteen and even four- 
teen. In the building trades, either by way of trade unions or in spite 
of them, nine and ten hours have become customary in place of eleven 
and twelve, 'or even more. In all the great retail shops and wholesale 
warehouses in which goods are distributed, the hour of closing is earlier 
and the hour of opening is later than it used to be. In the factory the 
rooms are better lighted, better ventilated, and in winter more uni- 
formly heated than ever before. Attention to sanitary conditions has 
become necessary even to pecuniary success. In the field the farm 
laborer rides upon the plow or upon the mowing machine, the hay rake, 
or the tedder, freed from the hard labor of guiding the plow by hand, 
mowing the hay with the scythe, or reaping the harvest with the sickle. 
The steam harvester and thresher have rendered the work of saving the 
grain crop vastly more effective and much less arduous to each person. 
In the building trades the small hoisting engine lifts the men and the 
materials to the tops of the highest buildings, while much of the heavy 
work of preparing the timber and other materials, which formerly re- 
quired long and arduous work by hand, is done by steam or water 
power in the factory. The optimist can thus find on every side facts 
which sustain his view that the general struggle for life is becoming 
easier and not harder, while the statistics of the life-insurance compa- 
nies prove that the duration of life is lengthening. 

Even in some cases where the quality of the working people may 
appear to have deteriorated, and their standard of living to be no 
longer equal to what it was in the same pursuit twenty or thirty years 
ago, one may find, on looking a little deeper into the causes of the 
change, that by way of improvements in machinery either less intelli- 
gence or less mechanical aptitude is now required on the part of those 
who tend the machines than was formerly needed in the same branch 
of industry. In this way a class of operatives has been brought into 
the factory and there enabled to do efficient work, for whom a few 
years since there would have been no place above the plane of un- 
skilled, menial, or common labor ; while the class of operatives 
formerly required to do this kind of work has been lifted up to better 
conditions, better work, and better wages by the possession of the same 
superior qualities which first enabled them to do the work of the 
factory when the machinery did less and the man or Avoman did more. 
Forty or fifty years since, the daughters of the farmers of New Eng- 
land worked thirteen hours a day in the cotton factory in order to earn 
$175 a year ; to-day French Canadians, working ten hours a day, earn 
$300 a year ; yet the cost of labor is less now than ever before. 



1 94 The htdustrial Progress of the Nation. 

Every point thus far recited can be sustained by such evidence that 
'it cannot be gainsaid by any one. In a broad and general way it might 
be proved that Uncle Sam and his children have obtained such power 
over the mechanism of production and distribution during the past 
twenty-five yeg-rs, that if the long hours of work required thirty years 
ago to produce the materials for a narrow and poor subsistence were 
now applied under the new conditions, the same hours would yield at. 
least one third more of all the necessaries and comforts of life than they 
did then. This gain in power has been applied in two ways. First, it 
has led in part to shortening the hours of work. Secondly, it has led 
in part to the attainment of a more ample subsistence and to a higher 
standard of common comfort and welfare. A better subsistence, better 
clothing, and better shelter are now obtained with shorter hours of 
work and less arduous effort than ever before, by all who have aptitude 
and industry coupled with the mental capacity which is required to 
enable them to adopt the new methods. Such must be the necessary 
conclusion from a comparison of the conditions of the present genera- 
tion with those of the one next preceding it. 

Yet no one can be blind to the fact that in many occupations which 
are necessary to the present mode of life, great numbers of persons are 
either worked to the utmost of their strength, or else are of necessity 
occupied so many hours of each day that what time remains to them is 
barely sufficient for eating and sleeping, so that healthy recreation is 
absolutely wanting. Time has not yet been saved to all. The well- 
trained or skilled workman can get more with less effort, but the com- 
mon laborers have increased relatively in their number by immigration, 
and are not yet educated to the level of the present opportunity ; hence 
arises want in the midst of plenty, and a waste of abundance which with 
better individual training might be saved and made conducive to com-^ 
fort and leisure. 

Again, many occupations which are necessary to the present 
methods of life, and without which modern society could not exist in 
its present form — especially the kind of work which is done in great 
factories, mines, and furnaces — involve the continuous labor of multi- 
tudes of men and even of women under very monotonous and in some 
few branches even noxious conditions, or else under conditions in 
which the attainment of even a physically clean and wholesome life for 
a part of each day or week seems almost hopeless. 

What is called division of labor distributes and sorts men and 
women each to a separate part of the work, which may be in some 
cases harmful to health, in some cases so extremely monotonous that 
there is no mental stimulus in it, and in some cases so depressing or 
even degrading in its necessary conditions as to preclude almost any 
hope of mental development. It is one kind of work all the time, in 



The Struggle for Subsistence. 195 

place of many and varying kinds dividing the longer day's labor. In 
former days there may have been more hard work, more unpleasant 
work, and even more unwholesome work to be done ; but was it not 
so divided and distributed that but few persons were limited to work 
of any one kind, day in and day out, for three hundred days in the 
year ? Was there not more variety, more versatility, and more oppor- 
tunity for young men and women to find out for themselves what they 
could do in the best way, and also a better opportunity to improve 
their position than there is now in the arts to which this so-called 
system of division of labor has been applied ? Was there not also a 
more humane relation between the employer and the employed, more 
sympathy, and more recognized mutuality in the service of each to the 
other ? Yet, if the great factory did not exist, and were it not for 
modern machinery and mechanism and this subdivision of labor which 
has become necessary to any adequate supply of the means of living, 
how could the existing population of Massachusetts, for instance, of 
whom at the present time more than one fourth are foreign-born, and 
more than one half of foreign parentage, live even as well as they do ? 
Had it not been possible for these foreigners to come here in order to 
avail themselves of the opportunity which is offered, how could they 
have existed at all in the lands which gave them birth, which are even 
now overcrowded ? If it sometimes seems that progress and poverty 
march together, one may ask what would have been the poverty with- 
out the progress ? If the analysis of our present condition, relatively 
good as it is compared to former times or to other countries, yet 
proves that only a narrow, poor, and meagre life has become possible 
to great masses of people, in what direction shall we look for the 
progress in which poverty shall cease to be one of the phases or 
correlatives ? Can we lift great masses of people all together to a 
higher plane, or must we rest content with such developments as open 
their own way to those who have the eyes to see and the capacity to 
attain each for himself or herself ? Can any one be boosted by the 
state who cannot help himself ? 

After all has been proved in respect to greater abundance, lower 
cost, more equitable distribution, higher wages, and smaller margins 
of profit ; after all has been recited that can be claimed in the line of 
progress, what does it come to ? What is the result ? What is the 
present measure or limit within which each and all must of necessity 
subsist ? Is it sufficient and ought it to induce content, or is there 
a sound and reasonable cause for discontent and a craving for some- 
thing better ? 

In order to consider these questions great aggregates in millions 
must be avoided ; such figures only mislead and delude. The condi- 
tions of life must be brought down to the unit of the individual or of 



196 The IndiLstrial Progress of the Nation. 

the family. When this has been done, the few who have attained an 
abundance, and who have reaped the full benefit of all that science 
and invention have enabled them to accomplish, may for the first time 
begin to comprehend the aspect of life that is presented to the many 
who have not yet secured a much better subsistence, or a more suitable 
dwelling, or greater comfort and better opportunities. 

These problems must be studied from below as well as from above, 
from within as well as from without, if the discontent of the present 
day is to be removed by gradual, peaceful, and adequate methods ; for 
the very reason that the better conditions of life which are now so 
readily attained by those who are capable of grasping the opportunity 
offered them, bring into more and more conspicuous contrast the 
adverse conditions of those who have not yet become capable of such 
attainment. 

Probably very few of the persons who will read this article, in fact 
very few among those who read with interest and intelligence any 
articles, essays, or books upon what is called the labor, question, have 
themselves had the kind of experience which is necessary to enable 
them to comprehend the aspect of life to the man who can earn only 
one or two dollars a day for the support of himself and of his family, 
if he has one. Perhaps even a less number may have the kind of 
imagination that will enable them, without having had the experience, 
to comprehend the struggle for life on these terms, even if they try to 
put themselves in the place of the common laborer or of the mechanic 
who can barely do the limited and monotonous work in which he 
is occupied, without the prospect of ever doing any thing more or 
different. 

If it shall prove that a great number of people at the bottom can 
barely exist, while a considerable number at the top enjoy much more 
than is required for a good subsistence, may it not soon become neces- 
sary for those who are in possession of wealth to justify their position, 
by proving that by the use either of their own personal ability or of 
their capital they add more to the annual product from which all in- 
comes are derived than they take from it for their own consumption ? 
The man of superior ability may add a million dollars' worth a year 
to the value of the annual product, which addition except for him 
would not have been made ; from this he may secure a personal in- 
come of a hundred thousand dollars a year, yet he costs the com- 
munity only what he and those who depend upon him consume. Is he 
not a cheap man for the community to employ in its service, even if 
he finds his recreation in fine horses and a fast yacht ? 

If nine tenths of the product which he has brought into use falls 
into the common stock whether he will or not, cannot the community 
well afford to him his tithe even if he wastes it ? Vanderbilt reduced 



TJie Struggle for Subsistence. iqy 

the cost of moving a barrel of flour a thousand miles from a dollar 
and a half to fifty cents ; was he not a cheap man for the community 
to employ even if he did make a hundred million dollars ? What he 
made himself was but a tithe of what he saved to the community. 

In other essays I have endeavored to show that not exceeding ten 
per cent, of the product of a normal or average year can be saved in 
a concrete form and added to the capital of the nation. Whether this 
ratio is correct or not, it will be admitted by all that a certain amount 
of capital must be saved in some way in order that society may con- 
tinue to exist, even under the present narrow conditions of life. It 
will be generally admitted that it is more important that capital should 
be efficiently maintained than it is to determine who saves it or who 
controls it. A large part of this addition to capital may, and doubt- 
less does, consist of the savings of persons who can never hope to 
accumulate enough to enable themselves to give up work in their later 
years, or to live wholly upon the income of what they may save. The 
most that the great majority can expect to do, is to lay up a moderate 
sum of which they may expend the principal when they become dis- 
qualified for work, unless they are then supported by their children 
wholly or in part. 

There are no dafa by means of which the number of the rich or 
even of the well-to-do persons can be set off as a separate class from 
the rest of the community ; that is to say, there is no way to find out 
how many can accumulate a sufficient amount of capital to enable 
themselves or their children to live upon the income of their property 
without further work. Suffice it that the proportion is very small in- 
deed in point of number ; and as the margin of profit becomes less, 
or as the amount of capital required in order to yield an income 
sufficient for a comfortable support without work becomes greater, the 
proportion of those who can hope to live without work in their later 
years will probably diminish rather than increase as time goes on. 

It is probable, to say the least, that fully ninety per cent, of the 
whole body of the people spend nearly all that they earn ; of this 
ninety percent, a portion may, by setting aside a moderate part of their 
small earnings, become the owners of a house, or become depositors 
in a savings bank, or insure their lives in a moderate way ; of the 
remaining ten per cent, a part save enough to protect themselves 
against want in their later years, and a very small part may become 
rich, and then need not work unless they choose. There are but few 
in each generation who do not choose to work, whatever their motive 
may be and however rich they may be ; the actual drones are but a 
small fraction even of the rich, hardly calling for attention. They 
are, like Mr. Toots, of little consequence to themselves and of no 
consequence to others. 



198 The Industrial Progress of the Nation. 

When it is admitted that the whole capital of the richest State in 
this Union does not, and probably never can, exceed in value three 
years' annual product of the same State ; and that the people of the 
richest State are always within one year of starvation, within two 
years of being naked, and within a very few years of being houseless 
and homeless, unless they work for a living, what possibility is there 
that any considerable part of one generation can save their children 
to any extent from the beneficent necessity of supporting themselves ? 
Our present aggregate product, whatever it may be, being mostly con- 
sumed by those who work for a living, what is the limit within which 
the measure or cost of living must of necessity be confined ? When 
we have settled this question we may ask, What is the aspect of life to 
the average man or woman who works for a living in order to gain a 
mere subsistence, and what can we do to better it ? 

In the next article I will give the reasons for my conclusion that 
the present limit within which the great mass of the people of this 
country must find food, fuel, shelter, and clothing ranges between that 
which forty cents and that which sixty cents a day will buy for each 
man, woman, and child in the community, the average not exceeding 
what fifty cents a day will purchase. It requires the work for gain or 
the earnings in money of more than one in three in the population to 
sustain the whole community ; and the average earnings of the great 
mass of the people range from $1.00 to $3.00 a day, on which earn- 
ings three persons must be sheltered, fed, and clothed. 

The picture which is brought before the eye or mind of him who can 
take in the full significance of these figures is somewhat appalling. It 
might lead many to ask. If this is the result of the highest civilization 
yet attained by the most favored nation, is life on the whole worth liv- 
ing ? and one must carefully guard himself against the influences of 
materialistic philosophy in order to keep an even balance in his 
own life. 

It may not be judicious for the mere business observer, who cannot 
claim to be able to comprehend any thing more than the elements of 
the philosophy of history, to venture to forecast the future ; yet to many 
prosperous persons who now pay little regard to the blind struggle of 
vast numbers of working men and women to improve their condition, 
and who think workmen have no rights to be secured and no wrongs to 
be redressed, one may rightly put the question. Have not you also 
something to do in the solution of these problems? Are there not 
signs of danger ? May not the existing unbearable tension among 
European nations, burdened as they are with monstrous national debts 
that can never be paid, and with huge and onerous standing armies 
which it seems to be impossible to disband, end in revolutions in which 
many feudal privileges and vested wrongs may go down forever, but in 



The Struggle for Subsistence. 1 99 

which also many institutions covering not only rights of property in 
land but in all the products on which existence depends, may for a 
time be questioned ? If such should be the course of events in other 
countries, are we so strong in our popular government that we ourselves 
may not share some of these difficulties and dangers ? Or even if there 
be no danger to society in this country, and, as the writer most pro- 
foundly believes, nothing but benefit to be ultimately gained from the 
organization of labor and the study of economic problems by so-called 
labor associations, clubs, and societies, might not all others also join in 
attempting to solve these problems, to the end that free institutions 
may be fully justified, not only by those who possess an abundance, but 
also by those who can find in such institutions the opportunity for them- 
selves or their children to attain the conditions of life which may indeed 
make this life worth living to the poor as well as to the prosperous ? 



VI. 

THE PRICE OF LIFE/ 

IN my last essay I endeavored to present the condition of life as 
they must of necessity appear to him or her who earns little more 
than enough, or barely enough, to support material existence. In 
those which preceded it I endeavored to define the limit within which life 
must be sustained, if sustained at all, under the present conditions of 
production and distribution. The series would be incomplete if in this 
paper the figures which define the limit were not again presented and 
worked out more fully and conclusively than they have been elsewhere. 
In the subsequent computations I shall omit small fractions and shall 
deal with round figures only. 

In 1880 the average family group consisted of five persons ; the 
working group consisted of a fraction under three persons, one of whom 
sustained two others. The time had not then come, and has not yet come, 
when the work of women and children for gain or money payment could 
or can be spared ; it will be many long years before the head of every 
family of five persons can produce enough, or can procure enough by 
his own exertions, for the support, in comfort and welfare, of four per- 
sons dependent upon him. This would be true if we were to consume 
for mere subsistence every thing that we produce. If the total product 
were divided evenly and consumed, there would not be enough to raise 
the general level much above what it now is, and the next generation 
would then suffer want because we had eaten up or worn out that part 
of the product which ought to have been saved in the form of capital. 

In all the computations which existing data enable me to make, I 
have been obliged to stretch a point and to assume a maximum rather 
than a minimum estimate of the gross value of the product of the 
nation, in order to find six hundred dollars' worth of food, fuel, shelter, 
and clothing as the average product of each person occupied for gain, 
by which product, whatever it may be, three persons must be subsisted, 
housed, and clothed. This is the gross product. Unless ten per cent, 
of the six hundred dollars' worth be set aside by some one, whether by 
rich or by poor matters not, to be added to the capital of the nation, 

^ Reprinted from the Forujn. 



The Price of Life. 201 

the product of future years will be diminished rather than increased, 
and want will then ensue rather than welfare. 

Again, a part of this product must be diverted by taxation to meet 
the necessary expenditures of the country and of the several States, 
cities, and towns. The taxes required for cities and towns are assessed 
upon property in a great measure, nevertheless they must come out of 
the gross product of the nation ; they represent work of some sort, and 
those who do the work, of whatever kind, contribute to these taxes. A 
tax cannot be made to stay where it is put ; it is distributed no matter 
where it may be first collected. 

All profits, all taxes, all shares of the product represent work of 
some kind, whether it be mental or mechanical or manual. It may be 
work in which capital or machinery has saved labor the greater part of 
the effort, or it may be work in which manual labor does the most and 
machinery the least. If the capitalist cannot demonstrate his right to 
the share which falls to him by proving that in the direction, control, 
and use of the capital which he owns he adds to the gross product 
more than he takes away for his own consumption and for that of those 
who depend upon him, then he must hold his capital only by force 
rather than by recognized service. If taxes cannot be justified in their 
expenditure, they cannot be justified in their collection. 

If the possession of property does not rest upon service rather than 
upon force, on what pretense can any one set up the right to property ? 
The word " right " cannot cover wrong. Can he who lives on others' 
work, or who takes from the product even a small part without adding 
by his own service or that of his capital more than he takes from it, jus- 
tify his existence or set up a right to the property that he misuses, no 
matter how legal may be his title ? 

In 18S0, State, city, and town taxes came close upon twenty dollars 
per head of all who were at work — about six dollars per head of the 
population. Assuming that sixty dollars' worth of the product, on the 
average, of each person occupied in gainful work must be set aside to 
be added to capital by some one, and twenty dollars' worth must be 
set aside to sustain States, cities, and towns, in order that society may 
continue to exist — eighty dollars' worth in all out of each six hundred 
dollars' worth, — we then find a net income, on the average, to each work- 
ing man or woman who is not in the public service or sustained by the 
taxes, of five hundred and twenty dollars a year ; or rather, what five 
hundred and twenty dollars a year will buy for their own consumption. 
Computing three hundred working days in the year, this gross sum of 
six hundred dollars yields a fraction less than one dollar and three quar- 
ters per day — a little less than twelve dollars per week, or fifty dollars 
per month, — and if out of this sum, or of what this sum will buy, after 
setting aside ten per cent, for the necessary addition to capital and the 



202 The Industrial Progress of the Nation. 

local taxes, three persons must be subsisted, sheltered, and clothed three 
hundred and sixty-five days in the year, the measure of the average com- 
fort and welfare is only about what forty-five cents a day will buy and no 
more. But even this narrow measure of subsistence is again subject to 
the indirect tax of the nation. The national revenues being chiefly col- 
lected by taxing articles of common or necessary use, are paid in pro- 
portion to consumption rather than in proportion to income or ability. 
In 1880 and since then, the national revenue has come to six or seven 
dollars per capita each year, varying somewhat ; or from eighteen to 
twenty dollars a year upon the earnings of each person occupied for 
gain ; leaving a net revenue of five hundred dollars a year, or only what 
less than forty-five cents per day will buy per capita for personal con- 
sumption. How much food, fuel, clothing, and shelter can the reader 
buy for forty-five cents a day ? Would it not be well to answer this 
question before what may be miscalled "the claims of labor" are 
wholly ignored ? 

There is, of course, room for error in this computation ; but an 
error of five cents a day per person now comes to more than eleven 
hundred million dollars a year, and one may fairly claim that such a 
gross error could hardly be made by a careful observer or compiler of 
statistics. In any event I think it may be assumed that our annual 
product at the present standard of production, when sorted and divided 
under present methods of distribution, and subject to no greater 
assessment than is necessary to maintain the capital of the nation and 
to meet taxation even when reduced to the lowest possible limit, can- 
not yield more than fifty to fifty-five cents' worth of the necessaries of 
life per day for the personal consumption of each man, woman, and 
child of the present population, after allowing for any possible error. 
It follows of necessity that by so much as some enjoy a larger portion 
than this must some others have less ; yet this is the most productive 
country in the world in ratio to its population, and great multitudes are 
flocking to our shores to take part even in this measure of abundance. 

Present population, about 61,500,000 

Share of total product consumed for personal use, at 50 cents per 

day each f 11,200,000,000 

National and State taxes, about 700,000,000 

Addition to capital, computed at ten per cent., about 1,300,000,000 

Gross product $13,200,000,000 

This would be about $630 per head to one in three occupied for 
gain. In order to increase the average consumption by five cents' 
worth a day to each person, an additional product of the value of 
$1,122,000,000 a year must be made ; a market must be found in order 
that this product may be converted by exchange and distributed in 



The Price of Life. 203 

terms of money. Yet we have heard more of over-production in recent 
years than of any other complaint ! Would not under-consumption be 
a more suitable term ? 

Now let any reader or observer pass in review or attempt to com- 
pute the number of people about whose condition he himself is toler- 
ably well informed in the community in which he lives, and he will 
unquestionably find a greater number of men and women who are en- 
gaged in getting their own living (to say nothing of children) whose 
earnings are less than one dollar and three-quarters a day, than he will 
of those whose earnings are more. What is the aspect of life to this 
vast body, constituting a majority of the people of this 'countn,% who 
earn less than one dollar and three-quarters per day. and who support 
themselves and two others on such an income ? When this question is 
brought clearly before the mind the true " labor question " begins to 
declare itself. 

What are you going to do about it ? Is it not a question which 
demands the attention of rich and poor alike in a democratic country, 
where the power of legislation rests upon the votes of the majority ? 
What do those to whom it matters little whether they spend twenty-five 
or fifty cents, or even a dollar a day, per capita, for the food only of 
themselves and their families, really know about the problem of life as 
it is presented to him or her whose food costs one half the entire income 
or earnings, and who must find not only food but a dwelling-place, 
clothing, and all the necessaries of life out of what forty or fifty cents 
a day will buy at retail prices at the present time ? What do people 
know about these conditions who never lacked sufficient clothing, and 
who possess more than one good room well warmed for each member of 
their families, or perhaps two or three good houses for one family ? 

If the limit of all that is produced is what I have given, or whatever 
it may be, whether more or less, it is the source of all wages, earnings, 
profits, rents, interest, and taxes. There cannot be more than all there 
is to be distributed, hence it follows of necessity that by so much as 
some have more of the comforts and luxuries of life, must others have 
less. Modem society exists by exchange. Few persons take any part 
in building their own houses or in furnishing them ; few do any thing 
more than a small part of the work of making their own clothing ; and 
aside from those who dwell upon farms, hardly any f>ersons produce 
any thing which they consume for food. There are only three methods 
of distribution yet invented. The first is by exchange ; the second is 
by theft or fraud, sometimes within the forms of law ; and the third is 
by taxation. These three ways take a variety of forms. How can the 
general welfare be improved except by increasing the product of labor 
and finding a market for it, or by doing away with every existing method 
of distribution which is not right or just "i 



204 The Industrial Progress of the Nation. 

There are certain ethical problems which may come into view to 
him who seeks to justify his own greater share in the comforts of life. 
One question which a man may put to himself might be, Does the 
occupation in which I am engaged add to the mass of products which 
are needed for general consumption more than is taken away by my 
own consumption or by those among whom I spend ray earnings ? Or 
even a deeper problera may sometimes arise of an ethical nature : 
Does the work which each man performs come within the line of 
useful service ? Does it add to the stock of useful products, or does it 
fall within the line of baneful service and add to the stock of harmful 
products ? Is the demand for which this man provides the supply of a 
kind which adds to the comfort of the community as a whole, or is it 
one which tends toward want rather than welfare ? By the answer to 
these questions each man may hereafter be judged in the court which 
supplements the treatment of economic questions by the study of ethics. 

Before we can begin to answer these questions in a satisfactory 
manner, it is almost a matter of necessity to analyze the occupations of 
the people of this country as they now are. We are enabled to do this 
with great confidence in the accuracy of our results, because the same 
census agents who counted the numbers also asked what every one did 
for a living. Therefore, under the head of occupations, the people of 
this country who worked for gain were classified by their own state- 
ments under separate titles. The compilations of the census are made 
under four general titles, to wit : 

Occupied in agriculture 7,670,493 

" " professional and personal service 4,074,238 

" " manufactures, mechanic arts, and mining 3,837,112 

" " trade and transportation 1,810,256 

17,392,099 

Thus the proportion of the whole population occupied for gain was 
substantially one in three of the whole number. This method of 
sorting is not wholly satisfactory. The writer has therefore made 
a different compilation under seven titles, as follows : 



How occupied. No. in Computed 

each 1000. total number. 



I. Mental work. ... 40 696,000 



'Clergymen, 64,968 ; lawyers, 
64,137 ; physicians and sur- 
geons, 85,671 ; teachers and 
literary, 227,710 ; journal- 
ists, 12,308 ; scientists and 
engineers, 8,126 ; musicians, 
30,477 ; officers of corpora- 
tions, banks, railroads, in- 
surance, etc., 202,423. 



The Price of Life. 



205 



How occupied. 



2. Mental and manual 



No. in 
each 1000. 



60 



Computed 
total number. 



1,044,000 



3. Automatic ma- \ 
chinerv S 



4. Mechanical : hand 
and machine tools. 



107 



1,740,000 



1,861,800 



5. Manual 131 

6. Horse and hand \ 

tools \ ^50 

7. Chiefly manual 312 



2,279,400 



4,350,000 



5,420,899 



Merchants and traders, 481,- 
450 ; hotel keepers, 32,543 ; 
clerks, salesmen, commer- 
cial travelers, brokers, and 
all others engaged in the 
purchase and sale of goods, 
521,898. 

f Collective factory work : tex- 
tiles, printing, and bleach- 
ing, 500,000 ; metals and 
machinery, 300,000 ; cloth- 
ing, 450,000 ; boots, shoes, 
and hats, 210,000 ; all others 
280,000. 

Mechanical not collective : 
carpenters and other work- 
ers in wood, 500,000 ; black- 
smiths, 172,726; painters, 
128,556 ; masons, 102,473 ! 
all others, 958,045. 
"Service: express, railroad, 
telegraph employes (not 
laborers), 300,000 ; domestic 
servants, 1,075,655 ; laun- 
dry, 122,000 ; waiters, 200,- 
000 ; draymen, hackmen, 
etc., 180,000 ; all others, 
391.345- 

Farmers, herdsmen, stock- 
breeders, and the like, 
{Laborers on farms, 3,323,876 ; 
laborers not specified, prob- 
ably in part on farms, 1,857,- 
023 ; miners, 240,000. 



1,000 17,392,099 

It requires but little experience or knowledge of the general condi- 
tions of men to determine that only a very small part of those listed 
under each of these titles are or can be men of wealth, or even in 
possession of such a considerable amount of property as to make their 
income derived from property the larger part of their annual resources. 
Moreover, if it be considered that there is a certain general average of 
income with respect to each class of occupations, one may reach 
a reasonably close estimate of the relative conditions or proportions of 
income of those who are listed under each title. For instance, under 
Title 2 it will be observed that more than half are in the position of the 
employed rather than of the employer — clerks, salesmen, etc. — who 
seldom make large earnings. Under Title 3, those who work upon 
metals and machinery earn the highest wages. Those occupied in 
making boots, shoes, and hats probably come next. Skilled labor in 
the clothing trade is better paid or earns more than skilled labor in the 
textile factory, while common labor in the clothing trade, even when 
paid all that it is worth, secures very small earnings. Under Title 4, 



2o6 The IndtistiHal Progress of the Nation. 

mechanics — all are substantially well-paid workmen, earning more than 
the average of those who work in the factories. As we come down in 
the list, the numbers relatively increase of those who spend nearly all 
that they earn in getting a living, of whom very few possess more 
property than a deposit in a savings bank. The farmers to a very large 
extent work harder than their hired men, and few become rich. 
Lastly, nearly one third of the whole number listed could reply to the 
census taker only that they were laborers. Is this wholly creditable to 
our system ? 

If, then, very few come into the possession of any considerable 
property, while a larger number, but yet a small proportion of the 
whole, attain an average income of one thousand dollars a year, by far 
the greater proportion living of necessity on less than $600 a year to 
each three persons, what can be done about it ? 

If from the earnings of every man gaining by his work more than 
$r,ooo a year, the excess were taken and divided equally among those 
who earn less, the game would not be worth the candle, because 
the gain to those who received the difference would be but a trifle. 
The addition to the income of each person occupied for gain would 
probably not be equal to the price of a daily glass of beer. On 
the other hand, if this excess of income above $1,000 a year were taken 
from those who now enjoy it, to be distributed unequally among the 
working people, then the same disparity of condition would exist 
as now, or even a greater. What are you going to do about it ? may well 
be the question put to the reformer who in his own judgment can 
remove all the inequalities and do away with all the hardships of life by 
acts of either the national or State legislature. The way to meet each 
and all of the theories of the professional agitators or sentimentalists 
who propose to change all the conditions of society by statute, is 
to bring the consideration of the subject within a limit easily compre- 
hended, say fifty to sixty cents a day, and then to call upon each class 
of reformers to meet the conditions as they now are, and to prepare an 
act of legislation by which better general conditions may be assured. 
This they may find a somewhat difficult matter. In subsequent articles 
their theories will be subjected to this test. 

The days of dynasties and of privileged classes are numbered \ 
emperors and kings, dukes and lords, have become superfluous ; feu- 
dal rights, which could perhaps have been justified in the past, have 
become the feudal wrongs of the present time. Democracy cares, 
nothing for inherited rank, and may call upon every man to justify his 
present condition by his service, under the coming democratic rule,, 
not only in this but in many other countries. The Chinese practice of 
granting titles of nobility to the ancestors of him who now serves his 
country well may be approved ; but no title gained in the past, unless 



Hie Price of Life. 207 

sustained by its representative in the present day by corresponding 
service, will long be tolerated as one either of privilege, honor, or 
credit to him who bears it. Gunpowder equalized the force of the 
seignior and the serf ; Vanderbilt became the great communist of the 
time when he reduced the cost of moving a year's supply of food a 
thousand miles to the measure of a day's wages of an ordinary me- 
chanic. Yet more remains to be done before the mass of the people 
even in the United States can be said to live well. What are you 
going to do about it ? 

In this series of articles, and in articles elsewhere published 
dealing with the same facts and statistics, the writer has proved, by 
arguments which no one has yet been able to refute or to gainsay, 
that 'in this country, which is no longer subject to the inherited 
wrong of slavery, in which birth gives no privilege, and in which all 
have or may have equal opportunity to attain material welfare, the 
working men and women who perform that part of the work of pro- 
duction which is either manual or mechanical, are steadily securing to 
their own use and enjoyment an increasing share of an increasing 
product ; while on the other hand, both the material capital which 
has been saved in a concrete form, and also the element which is yet 
more necessary to material abundance, the capital which is immaterial, 
/. e., the mental factor in all productions, are being placed at the ser- 
vice of those who do the primary work at a lessening rate of compen- 
sation or profit. Nevertheless, when all Europe is a prey to fears of 
anarchy, nihilism, socialism, and communism, and when it seems to be 
as impossible for the standing armies and national debts of the Conti- 
nent to be sustained as for the armies to be disbanded or the debts 
repudiated without violent devolution, may it not be well for us to take 
an inventory of our resources and to review our present methods of 
distribution, lest we also should perhaps be called upon, again and 
again, to apply force in sustaining rights of property both in land and 
capital, which need no force for their defense when fully compre- 
hended and justified by the service to humanity which their possession 
makes their owners capable of rendering in ever-increasing measure. 
May not the harmony of interest between labor and capital be dis- 
closed by the statistics of the nation to every one who can read what 
underlies the columns and is written between the lines ? May it not 
therefore be well for all to give their attention to what are indefinitely 
termed the " claims of labor," lest for want of thought, that which is 
right should be misconstrued and assumed to be wrong by those whose 
narrow or monotonous conditions of life limit the scope of their 
thought and may possibly lead them to misdirect their acts. 

The conclusion of the whole matter may perhaps be brought within 
the mental conception of any one who believes that there is order in 



2o8 The Industrial Progress of the Nation. 

the universe, and that there is an over-ruling power that makes for 
righteousness. The lesson which we learn is this : not only does 
enlightened self-interest coincide with or lead toward moral and mate- 
rial welfare, but even unenlightened self-interest, as represented by the 
mere money-getter, the mere capitalist, or by the man who has himself 
no knowledge of his own function, yet works of necessity in pro- 
moting an increased product and a reduction in the cost of all the 
necessaries of life, under which conditions the great mass of the 
community cannot fail to attain better conditions of welfare. Great 
inventions, which were first applied within a century, tended to the 
concentration of great masses of people under adverse conditions in 
the cities, and also to the diffusion of other great masses of people, 
occupied in farming, over wide areas, under isolated conditions which 
were not conducive to the best kind of welfare. The application of 
steam, of water power, and of gas led to concentration of the factory 
population. The introduction of the railway led to wide diffusion of 
the farming population and to " extensive " methods of agriculture. 
These applications of science are now being met by other great inven- 
tions, the tendency of which is in the reverse of what has occurred 
during the present century. The application of electricity to the pro- 
duction of speech and light, to the development of power, and to the 
operation of elevated or surface railways by which very rapid transit 
may be secured, and many other modern methods of distribution, are 
tending to diffuse many arts heretofore confined to the centres and 
crowded parts of great cities, throughout the suburbs and adjoining 
towns, where broad, low, well-lighted, and well-ventilated factories 
may occupy a larger area of ground, and where the factory operatives 
may live under very much better conditions. On the other hand, the 
adoption of the silo, and what are called the " intensive " methods of 
cultivation, are leading to the breaking up of large farms and bringing 
the people who are engaged in agriculture into closer communication 
with one enother. All these new forces are now in accord with the 
gregarious habit of men, and without overcrowding, will bring about 
more favorable conditions of life, while promoting an increase of 
product at a much less cost of labor than ever before, with correlative 
high wages and low prices. Yet the motive which sets all these new 
forces in action is the self-interest both of the capitalist- and of the 
workman, each striving to attain personal welfare only, but yet pro- 
moting the public welfare, whether conscious or unconscious of their 
true functions in society. 

It was said by the prophet of olden time that " The Lord m'aketh 
the wrath of man to praise him." It might be said by the prophet of 
the present, that the Lord maketh the selfishness of man to work for 
the material welfare of his kind. 



VII. 

AN EASY LESSON IN STATISTICS." 

IN this and in articles which are to follow, I shall endeavor to bring 
the present condition of the people of the United States into a 
form of statement which will enable readers to understand the 
bearing of many questions now pending to whom statistics are apt to 
be very dry and uninteresting. Persons who are not accustomed to 
deal with figures in very large sums, and to whom the incomprehen- 
sible millions of our national book-keeping carry but a confused 
impression, may easily comprehend the facts on which all fiscal or 
financial legislation ought to be based when the large sums of the 
national accounts are reduced to the quantities and values of a corre- 
sponding community of 6,000 persons. In this essay I have assumed the 
existence of a community of 6,000 souls whose conditions as regards 
occupations, industries, production, division, and utilization of land, 
etc., are as nearly as may be identical with those of the people of the 
United States in 1880, when the population was 50,000,000, or in the 
present year, when it is more than 60,000,000. I have made use only 
of such census figures as I believe to be worthy of trust or which 
I could substantially verify myself. Disregarding fractions, then, the 
following computations relating to 6,000 people correspond to the 
figures which would apply to the present population of the country, 
assuming that no material change has occurred since the census of 
1880 in their relative occupations and production. The figures of 
foreign commerce have not held quite the same proportions, but in 
other matters of production and distribution there has probably been 
but little change. 

I assume a typical township which covers 300 square miles. It is 
about 25 miles long east and west, and 12 miles wide north and south. 
It comprises 192,000 acres of land, of which about one half, or 96,000 
acres, is good arable land ; the rest is about equally divided between 
pasture, mountain, and forest. A little over twenty per cent, of the 
arable land, about 30 square miles, or 20,000 acres is under the plow. 
Within this area of 300 square miles there are 6,000 people, of whom 
2,000 (1,700 males and 300 females, including 35 boys and 14 girls of 
15 years or under) are occupied for gain, or are doing something by 
which they may get a living for themselves, each one on the average 

' Reprinted from the Forum. 
14 209 



2 lo The Industrial Progress of the Nation. 

supporting two others, either in farming, manufacturing, mining, 
or trading, or in professional or personal services. The 2,000 who 
are occupied for gain are occupied substantially as follows : 870 as 
farmers (490) and farm laborers (380), doing their work in part by 
machinery, mainly by the use of tools and implements driven by horse 
or manual power ; 226 occupied in personal service — servants, dray- 
men, hackmen, and the like — doing their work mainly by hand ; 224 
laborers not on farms — hewers of wood and drawers of water, diggers, 
and delvers ; 214 mechanics or artisans, working where the work is 
to be done individually rather than collectively^ and operating tools 
rather than machinery ; 200 occupied in the collective work of the 
factory, operating machinery rather than using tools ; 36 employed 
upon railways — engineers, firemen, and the like — omitting common 
laborers ; 30 miners ; 200 persons engaged in mental rather than in 
manual or mechanical industry, using their heads rather than their 
hands — clergymen, lawyers, doctors, literary persons, heads of corpora- 
tions, merchants, traders, and the like. 

The study of the occupations of the people may enable one to 
make a better estimate of their average income or product than any 
figures which can be compiled in a census ; therefore it may be useful 
to make even a closer subdivision of these pursuits : 

Occupied in agriculture : 

Farmers 500 

Farm laborers 370 

87a 

Occupied in personal service : 

Hotel keepers s 4 

Domestic servants, waiters, laundresses, coachmen, and the 

like 158 

Draymen and hackmen 20 

Others, including mariners and police 44 

226 

Common laborers 224 

Occupied in the mechanic arts : 

Carpenters, wheelwrights, lumbermen, and other men who 

work in wood 56 

Blacksmiths 20 

Painters 14 

Masons 12 

All other mechanics 112 

214 

Occupied in the collective or factory system : 

Workers in textile factories 60 

Metal workers in blast furnaces, smelting shops, machine- 
shops, and the like, worked on the factory principle 36 

Clothiers, tailors, and tailoresses 50 

Boot- and shoe-makers and hatters 24 

All other people who work in the factory rather than out-of- 
doors 30 

200 



An Easy Lesson in Statistics. 211 

Occupied on railways, omitting common laborers : 

Railway engineers, conductors, firemen, and brakemen 36 

Miners 30 

Occupied in mental work : 

Clergymen 7 to 8 

Lawyers 7 to 8 

Doctors 7 to 10 

Professors, teachers, musicians, and literary people 30 

Presidents of corporations, banks, railways, insurance com- 
panies, and the like 24 

Merchants and traders 56 

Clerks, salesmen, saleswomen, and book-keepers 64 



This classification by occupations is not an absolutely correct 
one, but it suffices for the general purpose of indicating the con- 
dition of the people. In former times, before the adoption of the 
factory system, each little community was to a large extent self-sus- 
taining. The material for garments was spun and woven in the house- 
hold. The farmer was a mechanic and almost of necessity a jack-of- 
all-trades, while the mechanic was apt to do a little farming. The 
local tailor and tailoress made the clothes. The work of each given 
community was much less subdivided individually than it has been 
since. Later came the substitution of the factory system for making 
cloth, the farmers' daughters leaving the farm and finding occupation 
in the factory. Then followed the wholesale clothier, and the local 
tailor as a maker of garments almost disappeared. 

But another phase of the distribution of work results from the 
reduction in railway charges. The railway system, by reducing the 
cost of moving goods to a fraction of a cent per ton a mile, practically 
converts a wide area into a close neighborhood. Hence there has been 
a considerable measure of household manufacture again introduced 
among farmers, but under wholly new conditions. The sewing- 
machine has become a necessary household implement, and the knit- 
ting-machine, sometimes owned in the farmers' families, but more often 
owned by a manufacturer of knit- goods, is widely distributed through- 
out the farmers' households of the eastern part of the country. The 
materials for ready-made clothing are cut at the manufacturing centres 
in the cities by the great clothiers, sorted, and put up in parcels with 
the thread, linings, and buttons ; or the worsted and woollen yarns are 
made up in packages with directions for their use. These materials are 
then distributed throughout the farmers' families in the Eastern States, 
to be made up into garments or worked into hosiery and knit-goods, 
sent back to the cities to be pressed and finished, and then distributed 
for sale. Thus there is a considerable amount of manufacturing car- 
ried on, especially by the women of the farmers' families, which does 



2 1 2 The Industrial Progress of the Nation. 

not appear in the census returns, and the women thus partly occupied 
do not appear in the list of those who are occupied for gain. The in- 
come for such work is small in each individual case, but it adds in the 
aggregate a large element of comfort and welfare to those whose every- 
day work is that of doing the household and dairy work among the 
agricultural population of the country. In the mountain section of the 
South, again, the old conditions of small self-sustaining communities 
still survive, but are rapidly disappearing. The people are clad in 
homespun, while the log-house and most of its contents are the prod- 
ucts of the handicrafts of the people. 

We will assume that the typical community is situated upon land in 
the northern rather than in the southern section of the country, and 
that the people are a little better off in personal wealth than the aver- 
age of the whole country. It may be assumed that they dwell in some 
part of Ohio, in which State the occupations of the people correspond 
very nearly in their proportions to the average of the whole country. 
The present value of all the land with all the improvements thereon, 
including railways, factories, machine-shops, dwelling-houses, public 
buildings, schools or colleges, and goods and wares of every descrip- 
tion belonging to this community of 6,000 persons, averages less than 
^r,ooo per head, and amounts in the aggregate to between five and six 
million dollars. This property is divided very unequally. The exact 
proportion of those who own some part of the land cannot be given with 
any "positive accuracy. Prom two fifths up to one half of the total 
valuation consists of the estimated value of the land ; from three fifths 
down to one half consists in the value of the improvements upon it. 
The data of accumulated wealth are somewhat uncertain, and the 
census estimates have been computed at different periods on such dif- 
ferent methods as to be almost worthless for purposes of comparison. 
The property assigned to this tj^pical community is probably a third 
above the average of the whole country. The value of all these im- 
provements or capital of the community, consisting of railways, fac- 
tories, workshops, machinery, tools, dwelling-houses, and public build- 
ings, also goods and wares of every kind, does not exceed $600 worth 
per head of the population, and is probably somewhat less. 

The average value of the annual product is about $200 per head, 
or $600 to each person occupied for gain. The capital oi this com- 
munity, in ratio to its production, is therefore equal to that of the rich- 
est State in the Union. In other words, the whole capital of the com- 
munity which has been placed upon the land is only equal to three 
years' product, even in the richest and most prosperous parts of the 
country. The value of the annual product of this community at ^200 
worth per head of the population, or computed at $600 worth as the 
average of each person occupied for gain, comes to $1,200,000 a year, 



An Easy Lesson in Statistics. 2 1 3 

including what is consumed by farmers and their families upon the 
farms. In this gross value of all that is produced, salable farm prod- 
ucts, rated at the farm before being moved away, come to $435,000. 
Assuming that each member of the families of the farmers consumes 
about %i2^ worth of the product of the farm at home, the value of the 
domestic consumption of the farmers comes to $87,000. The yield of 
minerals of all kinds, coal, oil, iron, lead, copper, gold, silver, etc., 
comes to $50,000. The yield of the forests is $So,ooo. The vilue 
added to the crude products of the farm, the forest, and the mine, by 
manufacturers, mechanics, and others, together with the charges for 
exchange and the cost for conversion and re-conversion into a con- 
sumable form, together with the product of the fisheries, comes to 
$548,000. 

SUMMARY. 

Primary value of the salable products of the farm $435,000 

Farm consumption 87,000 

Product of the forest 80,000 

Product of the mines 50,000 

Added in the process of manufacturing and for the cost of distribution 548,000 

Total !|i, 200,000 

It will be observed that, setting aside the sum assigned to home 
consumption on farms, the work of the country is about equally divided 
in value. The crude products of the farm, the forest, and the mine 
come to $565,000. The volume added in the process of manufactur- 
ing or distributing — of conversion and of re-conversion to final use or 
consumption — comes to $548,000. 

It is a curious thought that all this huge value of traffic, production, 
distribution, and conversion has for its end and objective point the 
supply of each inhabitant with a few feet of boards over his head, sus- 
tained by bricks or timber ; about ten pounds of wool and sixteen 
pounds of cotton converted into clothing, a barrel of flour, and two or 
three hundred pounds of meat each year, and a little sugar, a glass of 
beer, and about five pounds of solid or liquid food per day, these con- 
stituting the necessaries of life. Some one has said that life would not 
be worth living except for its luxuries, and that time would not be 
worth having except for the hours that could be saved for leisure. 
How much of luxury and how much of leisure can the average man 
get out of what fifty to fifty-five cents a day will buy for his shelter, 
food, and clothing ? 

It will be observed that 870 farmers and farm laborers were occu- 
pied in the production of grain, meat, butter, and cheese, vegetables, 
fibres, and fruit. This group produced more food than the 6,000 
people in this community could consume, all having enough and much 
being wasted. They also produced more cotton than could be spun 



214 '^^^ Industrial Progress of the Nation. 

or worn, but not enough wool. The miners produced more copper 
and silver than could be used and more oil than could be burned, but 
not enough iron. Some of the manufacturers produced more goods 
than this community required. Hence it followed that, at the ratio of 
1880, $100,000 worth of various commodities was sold for export to 
foreign countries. Of the exports, $84,000 worth consisted of the 
products of agriculture ; $16,000 worth consisted of cotton goods, 
manufactures of metal, tools, and implements, oil, manufactured 
tobacco, and the like. These figures are now somewhat changed ; the 
export of farm products is less, of manufactures more. This export 
corresponded to the work of 150 to 160 farmers and farm laborers, 
and 30 to 40 manufacturers, mechanics, and miners ; 180 to 200 in all. 
It consisted of a part of the product of a much greater number, but in 
proportion to the total the exports of the United States represent the 
work of about ten per cent, of all who are engaged in any industry which 
is directly productive. In exchange for this $100,000 worth of goods 
exported, this community imported from other countries at the ratio of 
1880, $75,000 worth of goods, and $25,000 worth of gold or government 
bonds brought home. , The imports consisted of the following articles : 

Yearly Imports. Per Capita Each Year. 

Sugar and molasses $9,500 fi-S^ 

Coffee 7,200 1.20 

Tea 2,400 . .40 

Breadstuffs 1,100 .18 

Fruits and nuts i,500 .25 

Animals, fish, drugs, dyestuffs, 

and other necessary articles 

which are free of duty 15,400 37, 100 2.56 

Chemicals 1,800 .30 

Flax, hemp, jute, and sisal grass 1,100 .18 
Iron and steel, and manu- 
factures 5,400 .90 

Hides, leather, and goods 1,400 .23 

Tin and tin plates 2,000 .33 

Raw wool 2,000 13,700 50,800 .33 

Manufactures of 

Cotton 3,300 .55 

Wool 3,800 .63 

Flax 2,800 .47 

Silk 3,800 .64 

Earthenware 600 . 10 

Glass 600 14,900 .10 

Fancy goods 600 . 10 

Spirits and wines. 900 .15 

Tobacco and cigars 800 2,300 .13 

Sundries 7,000 24,200 1.19 

$75,000 $12.50 



An Easy Lesson in Statistics. 2 i 5 

It will be observed that the imports from other countries consist to 
the extent of one half of articles of food, which are articles either of 
necessity or of common comfort. Adding to these the crude or partly 
manufactured articles which are necessary to the conduct of domestic 
industry, the proportion of this class of imports comes to two thirds of 
the whole. That part which could be spared, if we could not afford to 
pay for it with the excess of our grain, cotton, and oil, comes to only 
one third of the total import ; and that part which may be rightly put 
under the head of luxuries is but a tithe of the whole. 

Since 1880 exports have proportionately diminished, but imports 
have ratably increased about in ratio to population, and the above are 
about the relative values of goods now imported. The individual 
consumption of imported goods is now about f 12.50 per head, on 
which the duties come to a little less than $4.00 ; in round figures, 
$16.00 per head duty paid. The exports are now about equal in 
declared value to the imports without the addition of duties. As the 
sum of imports did not balance the export in 1880, the remainder was 
paid for in gold or bonds. These imports were taxed at the custom- 
house $24,000, or $4.00 per head of 6,000 people. 

It will thus appear that about 18 per cent, of the people occupied 
in agriculture in 1880 depended upon a foreign market for the sale of 
their product, to whom were added a few manufacturers and mechanics 
whose goods were sold for export. The export of food and fibres rep- 
resented 18 per cent, of the products of the farm, to which manufac- 
tures being added, the whole export stood for 8 to 10 per cent, of the 
work done by all who were occupied for gain. The import consisted 
mainly of articles of food or of articles in a crude or partly manufac- 
tured condition necessary to the work of the domestic manufacturers ; 
a small part only consisted of articles which could be spared, or which 
might under other conditions have been made within the limit of the 
community itself and by its own people. 

It is admitted that a part of this product of $1,200,000 worth is 
distributed in payment for rent of land, to owners in whose possession 
all the occupied land now is. There is still a large area of unoccupied 
land, but it is not yet available for use and may not be occupied for a 
long time to come. It is admitted that another considerable part of 
this product of $1,200,000 worth a year is distributed in the form of 
interest on bonds and mortgages, these evidences of indebtedness 
belonging to the few rather than to the many. Still another part of 
this product is distributed in the form of profits, and falls to the 
owners of the railways, factories, and other instruments of production 
constituting the capital of the country, in greater or less proportion 
according to the measure of service which they render to the com- 
munity. Another part is distributed in the form of fees or salaries 
among professional persons, musicians, literary people, and the like. 



2 1 6 The Industrial Progress of the Nation. 

Lastly, the greater part of the product is distributed in the form of 
earnings of wages among those who do the primary or mechanical work 
of production and distribution. Such being the measure of the whole 
product, by so much as some have a greater share must others enjoy 
less. If the whole sum of $1,200,000 worth were equally distributed, 
it would not even then suffice to meet a very high standard of general 
comfort and welfare ; it would come only to 55 cents' worth a day to 
each person. This is a large estimate if all were consumed in even 
portions. The whole work of production would still be substantially 
as great as it is now, and would not admit of any considerable amount 
of leisure on the part of the whole body of persons occupied for gain. 
There would be little relief in the hard work of getting a living. But, 
unless some part of this product of $1,200,000 worth of all kinds of 
goods and wares is saved and added to the capital of the community 
by some one, it matters not by whom, the next generation will suffer 
for want of capital. A considerable part of the product is wasted 
through ignorance or vice, while only a small part is wasted in luxurious 
living. " Mankind is as lazy as it dares to be," even now. 

In fact, that part of the product which may be added to the capital 
of the community must itself be consumed in the process of repro- 
duction or conversion into capital ; therefore the workmen who con- 
struct the railways, mills, works, and the like, in which the savings of 
the community are invested, get their subsistence, clothing, and shelter 
from what is paid them in doing this work. The object and end of all 
production is, therefore, in the first instance, complete consumption, 
the greater part of the product being consumed without specific repro- 
duction in the form of capital, the smaller part being consumed in the 
process of conversion into capital. Even that part of the product 
which is consumed in the more or less luxurious living of the prosper- 
ous is not wholly consumed by themselves. They may waste a part 
of their income or devote it to purposes which are not reproductive 
and are not necessary to comfort and welfare, such as the construction 
of palatial dwellings, the making of pianos, the laying out of fine 
places, the building of yachts, and the like ; yet even in this expendi- 
ture the workmen who do the work obtain their subsistence in return. 
No man lives to himself alone even in a material sense, and each one 
costs the community only what he and those dependent directly upon 
him consume on their own persons. What he spends stands for the 
subsistence of other persons. The rich man or the capitalist merely 
gives a different direction to the consumption of that part of the 
annual product which comes under his control from what it might 
otherwise have taken. It may be neither the most useful direction, the 
wisest, nor the best ; it may even be wasteful ; but even such methods 
of expenditure cannot be changed without altering the conditions of 



An Easy Lesson in Statistics. 2 i 7 

life and taking away the incomes of many of the workingmen, among 
whom the rich man expends his wealth. Liquor and tobacco are 
computed to cost consumers $75,000 to $100,000 a year in each average 
community of 6,000 persons. But if each producer or distributer of 
these articles averages the same income as in the other occupations — 
to wit, $600 each — then 125 to 167 men supporting 375 to 500 in each 
average community of 6,000 people, or 1,250,000 to 1,650,000 men 
supporting 3,500,000 to 5,000,000 men, women, and children in the 
whole country, now depend on the production and sale of liquor and 
tobacco for the means with which to buy their own food, fuel, clothing, 
and shelter. If the production and sale of liquor should be stopped 
they must find other work. Under the present distribution of occupa- 
tions and of products, does any one actually suffer because a sufficient 
quantity of the necessaries of life is not produced ? So long as no one 
suffers for lack of land or for want of opportunity to work for a living 
in consequence of the accumulation of wealth, may not the true remedy 
for want consist in the ignorant rich learning how to spend or direct 
the material force which comes within their control in a better way ; 
and in the ignorant poor learning either how to spend or to save the 
force which comes within their control in a way that will give them 
better results ? The waste of the many poor costs the community in 
the aggregate far more than the waste of the few rich. True progress 
may consist not in taking away from any, but in adding to the produc- 
tion of all, especially of the means for shelter. 

It may well be remembered that the science of distribution is as yet 
but little comprehended, while production in ample measure is abso- 
lutely assured. It is less than a century since even the English-speak- 
ing people began to learn the very alphabet of commerce ; has that 
part of the English-speaking people who occupy this country yet learned 
how to spell words of more than one syllable in putting together the 
letters of this alphabet ? They have learned that trade among them- 
selves has become profitable to all just so far as it is free from ob- 
struction ; have they yet to learn that trade with other nations may be 
as profitable when free from obstruction ? Have they not yet to learn that 
the nation in which the wages or earnings of workmen are the highest, 
because they make their products under the best conditions and there- 
fore at the lowest cost, can also gain the largest profits and earn the 
highest wages from the widest international commerce ? 

We sell to China coarse cotton goods made by weavers who earn a 
dollar a day ; yet four fifths at least of the people of China are clothed 
in coarse cotton goods woven on hand-looms on which the weavers 
cannot earn more than ten cents a day. They pay us in tea produced 
and prepared at wages of ten cents a day, which we could not afford to 
grow at wages of one dollar a day, even if it would grow in this coun- 



2i8 The htdustrial Progress of the Natio7i. 

try, because we cannot spare the time for that kind of hand-work. We 
sell flour produced at wages four times as high as they are in Belgium, 
in competition with the tillers of small fields in that country, to which 
machinery cannot well be applied. We take our pay in part in high- 
priced Brussels lace, made by women who work for the lowest wages 
and under the worst conditions of almost any people in Europe. If 
we want the lace we could ill afford to make it under such conditions. 

In the community of 6,000 people which I have taken as an example 
there may be a few paupers, mostly foreign-born ; but no one in this 
community is allowed to suffer for want of the absolute necessaries of 
life, except through oversight or accident. 

I have given the probable average product of each person occupied 
for gain at $600 worth per year. This yields, disregarding fractions, 
what fifty-five cents a day will buy in the form of food, fuel, shelter, 
clothing, and sundries for each man, woman, and child ; so close does 
want tread upon the heels of plenty. This is in fact a large estimate. 
There are a great many more people whose product is less than fifty 
cents' worth a day each for themsel\»es and those dependent upon 
them, than of those who earn more ; yet this is the richest, most 
productive, and most prosperous country in the world. 



VIII. 
REFORMS THAT DO NOT REFORM.' 

ASSUMING the conditions of an average community of 6,000 
people to be substantially as stated in the last number, we find 
but three ways of improving them, namely : First, by increasing 
the quantity of the product, and finding a market for the increase, in or- 
der that it may be converted into money and distributed. Secondly, by 
changing the present methods of distribution of that which is now pro- 
duced, without increasing the quantity ; that is, by finding a way by 
which those who have not quite enough for comfort and welfare may 
rightfully secure a share of that which is wastefully consumed by those 
who have too much or who spend unwisely. Thirdly, by improving 
the mode of using what is now produced, without increasing the 
quantity or materially altering the present method of distribution, so 
that it will yield a better subsistence to all. 

What is now somewhat indefinitely called the " labor question " 
must of necessity consist in solving one or all of these three problems. 
What other way is there to improve the conditions of the community ? 
If all that is produced by each average community of 6,000 people 
comes within the limit of what will sell for $1,200,000, or what that 
sum will buy at present prices, surely that fund constitutes the source 
of all earnings, wages, rents, profits, and taxes. We can consume no 
more unless we can re-convert into food, fuel, and clothing a part or 
all of the capital of the country which has been saved in our two hun- 
dred years or more of existence, amounting to less than three years' 
product, the whole of which, if consumed, would save us only two or 
three years' work and serve us only until it was exhausted. What 
should we do then ? We cannot have more than all there is ; therefore 
the limit of all that is produced must be regarded in all plans of social 
reform by all alike. This fact must be considered by the anarchist, the 
socialist, Lhe communist, the advocate of the single tax on land, the 
representative of the Anti-Poverty Society, the wage-earner, the co- 
operator, the knight of labor, the profit-sharer, the free-trader, the 
protectionist, the eight-hour advocate, the advocate of fiat money, the 
' Reprinted from the Forum. 
219 



2 20 The Industrial Progress of the Nation. 

mono-metallist, and the bi-metallist. The theories of all these doctors, 
of social philosophy — quacks, or regular practitioners — must deal 
either with what is now produced or else with plans and methods by 
which the gross product can be increased and more equitably dis- 
tributed. The question in plain prose is, How much can you add to 
fifty cents' worth a day ? 

If, then, the average product at retail prices is what I have estimated, 
to wit, not exceeding fifty cents' worth per day for each person, from 
which sum all profits, wages, earnings, and taxes must of necessity be 
derived ; or even if I have made an error of five or ten cents a day, 
which would come to one thousand million or two thousand million a 
year in computing the gross value of the product of the United States 
— not a probable error ; then fifty-five to sixty cents a day is the limit,, 
and even that limit is a very narrow one ; it leaves little margin for 
saving either time or work. 

This special community of 6,000 persons would have furnished 
itself, according to the average of the whole country, with fifteen miles 
of railway ; but being a more prosperous community than the average, 
it has perhaps twenty, thirty, or possibly forty miles. Of the 2,000 
persons occupied for gain, 140 may be engaged either in operating or- 
in constructing railways, 36 as engineers and firemen or other em- 
ployes, the rest as mechanics and laborers. Of the nineteen to twenty 
million men, women, and children now carrying on the work of this 
country, probably more than twelve hundred thousand men are occu- 
pied either in operating or in constructing railways. This railway 
force is our standing army ; while other nations prepare for war we 
prepare for peace and plenty by opening the ways for cominerce. 

It is curious to observe that the only relics of the great Roman 
empire which now have any actual utility among men are the Roman 
road and the Roman law. The one, which was constructed to open 
the way for conquest, remains an open way for commerce ; the other 
remains at the foundation of our civil organization ; all else has 
vanished except Roman literature and art. Of all the forms of capital 
which at the present day are springing into existence, perhaps less will 
remain even a century hence than now remains of the capital or prod- 
ucts of the Roman empire, if we except the opening of the ways. The 
term " fixed capital " is sometimes used to distinguish the less perish- 
able forms of capital from those which are useful only for the day ; but 
there is nothing fixed except the law of change. There are factories 
in existence which purport to be fifty years old ; but within that time 
the motive power and all the machinery has been changed once, twice,, 
or thrice. Where land can be had, true economy may now consist in 
taking down the high building of five or six stories piled one upon an- 
other, and in reconstructing the mill only one or two stories above the 



Reforms that do not Reform. 221 

ground ; such changes are now being made. Who can tell when the 
next inventor will appear who will destroy all the rolling-stock of the 
railways ? Who can tell how long people will be satisfied with the 
present crude and unscientific methods of constructing dwelling- 
houses ? What useful factor or form of capital exists in a material 
form to-day that is more than a few years old ? What permanent im- 
provement have we made on the face of the land even in this country, 
■except in leveling the hills, piercing the mountains, filling up the val- 
leys, and laying down the ways of commerce ? All that we can do is 
to move something ; we can make nothing. And when we have opened 
the way, laid the rail, and brought the line to the seaboard, why do we 
obstruct the distribution of our own products ? Why do we construct 
legal barriers to commerce with Canada and Mexico, for instance, more 
difficult and costly to surmount than any of the heavy grades over the 
mountains. 

This community of 6,000 people would have furnished itself, at the 
average of the whole country, with $150,000 in lawful money, consist- 
ing of gold or silver coin, legal-tender notes receivable for taxes, con- 
vertible bank-notes, and. certificates based on silver or gold. The more 
dense the population, the greater will be the proportion of checks sub- 
stituted for actual money ; and the more widely scattered the popula- 
tion, the more actual money must be carried in the pockets of the 
people. All we have to do is to keep the quality of the money good 
and the quantity will take care of itself. 

It is admitted that there may be a small margin of error in each 
and all of these computations. The proportion of people engaged in 
the different arts varies materially in different States, but it is not 
necessary that the proportions assumed should exactly correspond 
with those of any particular State. These small figures represent very 
nearly the proportions of the work and of the product of the whole 
community. In taking the United States Census returns of the occu- 
pations of the people, the margin for error is small, and the errors 
would alter the proportions assigned to each occupation in this small 
community only by a fraction. 

We have become so accustomed to treat income in terms of money 
that a person is apt to stop at the figures without giving thought to 
what the money will buy. Now the money measure of the income is 
but an evidence that productive work has been done from which the 
income has been derived. The work itself varies in quantity and 
quality ; the income of each person depends more upon the quality 
than upon the quantity of his work. Therefore the apparent paradox 
comes within easy comprehension, to wit, that in determining the cost 
of any given service the rate of wages in money is no sure standard, 
but if the quality of the work from which the wages or earnings are 



2 22 The Industrial Progress of the Nation. 

derived is good, the rate of wages will be highest where the actual cost 
of production is lowest. 

Again, the rate of earnings not commonly called wages but counted 
under salaries or profits, will be highest in proportion to the quality 
of the mefital factor by which the manual or mechanical work is 
guided. In this, again, the paradoxical rule will hold good, that the 
highest earnings or salaries and the largest profits are derived from 
the largest product inade at the lowest cost by the payment of the 
highest wages which the sale of the product will permit, and by the 
application of the most effective proportion of mental rather than of 
manual work. It is in this way that the function of the capitalist is. 
justified. By his mental power in guiding and controlling the appli- 
cation of capital in the most effective way, he adds to the product of 
the community tenfold or twenty-fold what he takes from it for his 
own consumption. He thus reduces the cost of all production, and 
increases the real wages or earnings of all the manual or mechanical 
workers who join with him in the conduct of all the industries and 
occupations of the country, because he not only assures the highest 
wages to those who perform the most skilful and effective work, but 
he is engaged in a perpetual effort to make his capital more effective, 
so that the proportion of his capital to the quantity or value of his 
product steadily diminishes. Under this imperative law the rate of 
wages of the workman is raised, and at the same time each dollar or 
unit of the wages will buy more of the product of the establishment in 
which he works, or more of the materials for shelter, food, and clothing 
for which the jjroduct of that factory may be exchanged. If such are 
the methods of progress under the competitive system which now 
prevails, we may well hesitate in attempting to reconstruct society by 
any of the processes submitted by ardent reformers, whether quacks 
or regulars. 

Now, then, how can we reform, change, alter, or improve the present 
condition of any 6,000 people consisting of a few rich, a considerable 
number of well-to-do, a large number of busy, fairly well-housed, and 
fully nourished working people who are engaged in all the arts of life^ 
and a moderate proportion of poor ? There are Protestant and Cath- 
olic, temperate and intemperate, well-instructed and ignorant, as there 
are in each community wherever vv'e take the average. It is possible 
that many difficulties may arise in the application of special, and 
theoretic methods when the attempt is made to deal in a practical way 
with this typical community of 6,000 people, which do not appear to 
the minds of those persons who think they can reform the whole na- 
tion by an act of legislation. Many men think themselves fully com- 
petent to regulate the operation of 150,000 miles of railway and to 
bring it all under very simple rules, but I have never found one who 



Reforms that do not Reform. 223 

was willing to take the whole regulation, charge, and direction of the 
bakers' carts, the butchers' and grocers' wagons, or the job teams of a 
single city, or to attempt to reduce the cost even of distributing bread 
after it is baked. The distribution of bread after it is baked now 
costs the average workman in a city as much as it does to grow the 
wheat, mill it, barrel it, move it 1500 miles, and convert it into bread, 
all put together. If the theories of obstruction and regulation which 
have been attempted in the control of the railway system were fully 
applied to the traffic even of a city of moderate size, it would alihost 
surely happen that some of the inhabitants would starve every week 
unless put into the almshouse. 

It is easy to imagine the conditions of a small community of 6,000 
persons, some of them far distant from the rest in the outskirts of the 
300 square miles occupied, others living in closer neighborhood, as in 
villages ; while in a district close to the coast-line there may be a town 
in which people are crowded together as they are in many of our large 
cities. We can also imagine in each community a certain number of 
" cranks," a certain number of dishonest people, a certain number of 
thieves who steal either within or without the forms of law ; also a 
certain number of sentimentalists who, finding things all wrong, are 
absolutely certain that they can put them all right ; and also a certain 
number who promote pauperism by indiscriminate almsgiving ; finally, 
a good many who think they could build up a community, if they 
only had their own way, in a much better form than that in which this 
community finds itself. Would it not be judicious to apply a little 
common-sense to some of the methods which are indicated by the names 
or titles already given to the several classes of social reformers and 
economic theorists ? 

We may perhaps find in each community of 6,000 people one or 
two anarchists, who have been bred in a foreign land under a despot- 
ism, and who think that because there may be no way out from that 
despotism except by assassination or by the destruction of all existing 
forms of society, therefore the same methods should be applied in this 
community ; so they shoot a policeman in place of a military ruler. 
Is there any better way of dealing with them when they become vio- 
lent than the Chicago method ? 

There will be a few socialists, or advocates of what is called the 
collective method of regulating society under the control of the state, 
who desire to bring all the property of the community under state 
control, and to do away with private enterprise and private property 
both in land and capital. They present a grand scheme under which 
every one shall have enough and none shall have too much. Suppose 
this grand scheme limited to the conditions of any 6,000 people, 2,000 
of whom — men, women, and children — are occupied for gain, per- 



2 24 The Industrial Progress of the Nation. 

haps one in five of whom may be a voter or a man of arms-bearing 
age, and of whom 800 may sometimes vote. Now in what community 
of 6,000 people will any considerable part of the 800 men who vote, 
or of the 800 women, a part of whom want to vote but who are not 
permitted, ever agree to put the conduct of all the business and the 
control of all the capital, all the farms, factories, forest, and mines 
into the hands of the town officers by a majority vote ? Who would 
be the aldermen, the councillors, or the selectmen chosen to become 
the managers of all the railways, factories, shops, and warehouses ? 
How would they be selected ? What would be the condition of the 
civil service of that community? Who would be "boss"? Would 
such a method of controlling the capital of the community increase 
the product so that there would be more than $200 worth per head 
each year, or about fifty cents' worth a day per head ? -Would this 
plan be apt to improve the methods of distribution ? If it did not, 
who would be any better off ? If, on the contrary, it were to diminish 
the present product and put the distribution under the control of the 
superintendent, might not a good many people starve who now get 
some sort of a living ? Is not despotism, either of one or more, the 
necessary complement of socialism ? Fully admitting that there are 
many functions of society which the state or the municipal corporation 
can perform for the citizen better than they can perform them for 
themselves, yet if it would be manifestly impossible even for a small 
town of 6,000 people to charge the officials with all that the advocates 
of socialism or of the collective system propose, is it not yet more im- 
possible for the Congress of the nation to interfere in the direction of 
many of the functions now attempted by it ? 

The communist, of whom a few examples are always to be found in 
every community, proposes to divide the annual product equally among 
the members of the community — to have all things in common. There 
have been some examples of successful communism in a limited way ; 
as, for instance, in the Shaker communities ; but the Shakers impose 
a strict limit upon population, besides requiring an equal distribution 
of the products of labor. This' is logical. The general application of 
their principle would lead to complete success ; that is, there would 
be enough for all, for the reason that all would soon be none. When 
we ask a communist whether or not the application of the policy sug- 
gested by him would lead to a product exceeding that of the present 
day, about fifty cents' worth daily per head, he is incapable of giving 
any affirmative answer ; all such undertakings which have assumed any 
importance, except that of the Shakers, having failed and broken up. 

Of late, the renewal of the proposition long since presented by the 
economists who were known as the physiocrats of France, that all value 
•comes from land, coupled with a plan for collecting the entire revenue 



Reforms tJiat do not Reform. 225 

■of the country by the imposition of a single tax upon the value of land, 
has led many hopeful persons to believe that the panacea had been 
found, and that all that is needed to bring about uniformly better con- 
ditions is to adopt the single-tax system and to organize anti-po^'erty 
societies. It is held by them that the rent of land would be more than 
sufficient to meet all the expenditures of city, town. State, and nation 
combined, and that by so converting what is now paid as rent into 
taxes, no rent could thereafter accrue to the benefit of private persons. 
The advocates of the single-tax system admit that the private posses- 
sion of land is necessary to its productive use ; they only propose to 
tax land more and other property less, and they object only to the 
private possession of land under any other conditions than their own. 
There is no absolute private ownership of land in this country. All 
land is now held in conditional possession only. It is subject to the 
right of eminent domain, subject to be taken for public use, and sub- 
ject to the condition of paying taxes lawfully assessed upon it. It 
therefore follows that the advocates of the single-tax system propose 
only to change the conditions under which land shall be held in private 
possession hereafter, as compared with the conditions under which it 
has been so held heretofore. Will this change increase the product ? 
Will it tend to the application of more capital or of less capital to the 
improvement of land. Raw land has no value. When a high price is 
paid for a corner lot in a city it is paid for the choice of position, not 
for any inherent value in the land itself. Until the town house is built 
upon it the corner lot will yield neither rent nor tax. Where land can 
be occupied and used the highest price is paid for the selection, in order 
that the occupant or possessor of the corner lot may distribute the 
greatest amount of products at the lowest charge for the service. Land 
attains value only in proportion to the labor and capital which are ap- 
plied to its use and occupancy. There is more free land waiting to be 
used at this time in this country than ever before, for the reason that 
capital applied to the construction of railways has brought the whole 
country within the reach of settlers at the lowest possible cost. In the 
older seaboard States land is available for use on better terms than it 
could have been obtained by the original settlers, who paid nothing for 
it, and who were not subject to any rent, for the reason that the greater 
part of the agricultural land of the Eastern States could now be pur- 
chased at much less than the cost of clearing and improving it, or at 
less than the cost of the buildings upon it. 

It is also probably an error to suppose that the present rental value 
of land, taken by itself, including that somewhat indefinite factor, the so- 
called " unearned increment," even if it could all be converted to public 
use in payment of taxes, would suffice to meet the necessary expenses of 
government even for State, city, and town purposes. For several years 



2 26 The Industrial Progress of the Nation. 

the assessors of the city of Boston, where the present valuation of land- 
is very high, have kept the valuation of land for the purpose of 
taxation separate from that of buildings and personal property. The 
valuation of the city for the year t888 was $764,000,000, on which a 
tax is to be assessed of $10,000,000 for city, county, and State pur- 
poses, at the rate of $13.50 on each $1,000 worth of property. Land 
and buildings are assessed nearly if not quite up to the market value. 
Personal property is reached by the assessors of the city of Boston in 
larger measure than in any other city in the country. At the average 
of recent years, the value of land is $333,000,000 ; of buildings and 
improvements, $230,000,000 ; of personal property, $201,000,000. In 
order to raise $10,000,000 revenue the tax upon the whole must be 
$13.50 on each $1,000. If the assessment were made upon real estate, 
including land and buildings, the rate would be $17.75 ! o''-- making 
allowance for abatements, $18.50. If assessed on land value only, the 
assessment would be a little over %ZZ-) allowing for abatements about 
$35, on each $1,000. It is doubtful if the rental now obtained by the 
owners of all the land of Boston would more than meet the $10,000,- 
000 expenses of the State and city, omitting wholly the amount re- 
quired by the nation. It must be remembered that our national taxes, 
amount to a sum as large, if not larger than all the State, county, city,, 
and town taxes combined. 

Let it be assumed that all the taxes are levied upon land at $35 
per $1,000 : the first question which arises is. Would not this heavy 
rate immediately depress the value of land ? It has done so in other 
cases where even indirect taxes upon land customarily assessed upon 
occupiers and not upon owners have become excessive. I heard of 
good land in England last summer on which the rates and tithes were 
so heavy that its market value was only five shillings an acre. The 
rates, tithes, and other burdens upon wheat land in Great Britain,, 
where there is almost no direct tax upon land value, come to more 
than the entire cost of producing wheat in Illinois, Minnesota, or 
Dakota. If the value of land were thus reduced, the revenues would 
of necessity be derived in some other way than by an assessment on 
value. It would then become necessary for the city assessors to- 
determine the relative rental value and not the salable value of each 
parcel of land ; they must then assess a tax on it in the form of rent 
without regard to what it would bring in the market. The end of that 
would be that the city would become the landlord and the assessors 
would fix the rent. How would they change the rental from time to 
time, to meet new conditions as the value of each particular site for 
use or occupation changed, permanent possession of land being 
admittedly necessary to its productive use and occupancy ? When the 
rental tax had been fixed for a long term — without which fixity of 



Reforms that do not Reform. 227 

tenure no permanent buildings would be constructed, — if the site value 
increased the tenant would sell his lease for a bonus and thus secure 
the unearned increment. If the site value decreased, he could no 
longer pay the tax ; Avho would compensate him for the unearned 
decrement ? Witness the failure of the attempt to fix judicial rents in 
Ireland by the decision of a court. In many cases the tenant has 
secured a reduction by representing to the satisfaction of the court 
that he could pay no more. As soon as the rent has been fixed, the 
tenant has sold his new lease at a large bonus or premium. Who 
would put a building upon land under such a no-private rent and 
single-tax tenure, unless he could obtain a permanent lease from the 
authorities at a fixed rental or an agreement for taxation at a fixed 
rate ? Who would then put a building upon such land unless he could 
obtain the average income from his capital, and unless he could 
recover in addition thereto the rent or taxes due to the city, from those 
who should occupy or use the buildings upon the premises ? Would 
land subject to an annual tax of $35 per $1,000 on the present value be 
more widely distributed than it now is ? This tax must be the first 
lien upon the land ; could any man except a large capitalist afford to 
occupy land on such terms ? How would a single tax on land affect 
farmers, who can now barely earn the tax imposed on their land and 
who seldom get more than a fair return for their labor out of their 
land as compared with the returns from other occupations ? Most of 
the farm land of this country is no-rent land ; it yields no more than a 
fair return for labor. How would country towns obtain any revenue, 
where all the land yields but a meagre support to those who either 
occupy or cultivate it ? 

The fallacy of this proposition lies in the fact that land is the only 
source of primary production, and is not the only source of income. If 
taxes are to be strictly assessed on land in ratio to its capacity to yield 
rent or a rental tax, then the possession of land in the hands of those 
most capable of using it as an instrument of the utmost production 
must become necessary in order that the tax may be met. Low-taxed 
land now serves for the support of many who have neither the capital 
nor the capacity to get the utmost production from it ; but if all taxes 
are put upon land only and the rate thus becomes very high, it can be 
used or cultivated only in the most productive way, and this implies 
large capital and full capacity. Would not this again tend to the con- 
centration of land in fewer hands than now possess it ? Would not the 
capitalist, or any other person who might possess the land under the 
new conditions, be enabled to distribute the whole of the single tax 
among the consumers of all products more surely than he does now ? 

Finally, would this change in the system of land-tenure lead to an 
increase of production ? If the present product is fifty cents' worth 



2 2 8 The Industrial Progress of the Nation. 

per head of the population, more or less, what would be the effect of 
the single-tax system in increasing or diminishing this product ? When 
the advocates of this system put their proposed measure into the form 
of a bill to be submitted to any legislature, their difficulties will begin 
and the fallacy of their reasoning will at once become plain. I may 
suggest that it is often a sufficient test of an a priori theory to ask the 
proponent to put his proposed system in the form of a bill to be passed 
upon by any legislature. This brings the subject to a practical issue, 
and in nine cases out of ten the theorists are incapable of framing an 
act that will work, because their propositioris are impracticable. 



IX. 

HOW SOCIETY REFORMS ITSELF.' 

THE advocate of co-operation holds out the expectation of great 
benefit to the community by the adoption of that system, 
especially when applied to distribution. One may ask those 
who prefer this method, If you desire to co-operate, why do you not 
co-operate ? There is nothing to prevent, except the one fact which is 
commonly overlooked, namely, that the small margin of profit which 
now suffices to maintain the great shops of this country, dealing upon 
the cash system and upon the principle of large sales and small profits, 
leaves little or no fraction to be saved by those who choose to co- 
operate in some other way than by buying at such a shop. The 
highest city rents are paid by the great shopkeepers for warerooms in 
central locations, in order to be able to distribute goods at the lowest 
cost, because such places are most convenient for their customers. 
The customers save more time and labor for themselves by going to 
these great shops in the trade centres, on which the highest rents are 
paid, than they can save for themselves by going long distances to 
small shops widely scattered, or by attempting to share the small mar- 
gin of profit by going into the business of co-operation. It is also 
probably an error to suppose that the big shops eat up the little ones. 
The vast increase in the mass of commodities to be distributed in 
recent years makes the big shops necessary to do the additional work, 
while what are now small shops in the smaller cities would have been 
great shops in the great cities thirty or forty years ago. The largest 
dealers do their work at the least specific charge or profit on each 
transaction ; it is only in the small shops, especially in those giving 
credit, that the cost of distribution is high in proportion to the amount 
of the business done. At a recent convention of the representatives 
of co-operative distribution in Great Britain, where long credit, even 
on retail purchases, has engendered high cost in distribution, it 
appeared that the profit saved and divisible among themselves 
amounted to more than twelve per cent, on the gross sales. It is well 
known that the co-operative shops on a cash basis sell at lower prices 
' Reprinted from the Foru?n, 
229 



230 The Industrial Progress of the Nation. 

than the private shops. Where is the great shop in any city in the 
United States in which the net profit is even half of twelve per cent, on 
the gross sales ? The largest fortunes are made on a much smaller 
margin of profit. On the other hand, the rents, charges, and expenses 
of the great shops, large as they are in the aggregate, come to a very 
small percentage on the gross sales, while in the management of the 
separate departments of these great establishments, large numbers of 
men attain success as business men who have failed in their attempts 
10 transact the same business wholly on their own account. 

The operations of the great banks are probably conducted at the 
least margin of profit on each transaction, as compared with all other 
branches of commerce. It is for this reason that in all times and in 
all places, since banking became one of the necessary factors of com- 
merce, the highest mental qualities of judgment, prudence, and fore- 
sight, as well as the highest moral qualities of honor, probity, and 
truth have been called for and have been found in those who have 
conducted the great banking houses of the world. On the other hand, 
there is no truer standard by which to measure the general intelligence 
and integrity, or the want of these characteristics, in a given com- 
munity, than by the support or obstruction which its members may 
give to the establishment of a well-developed system of banks and 
banking. 

We may therefore ask the advocates of co-operation. Would your 
method increase the general product or decrease the cost of distribu- 
tion so that each one might get more for his fifty cents than he gets 
now ? Can you save any thing in the general cost of distribution ? If 
you can, why do you not co-operate ? So far as legislation is con- 
cerned, the way is open. 

Another proposed panacea is that of profit-sharing. In one way 
this has been an established method ever since the factory system was 
introduced. Payment by the piece is but a system of profit-sharing 
without imposing upon the workman any responsibility for losses. It 
lies at the very foundation of the rule that large earnings are the 
correlative or complement of a low cost of production ; it is also con- 
ducive to greater profit in any branch of industry to which it can be 
applied than employers can secure by any other method. Profit-shar- 
ing in this way is, however, very different from the conception of those 
who advocate it as a more just method of distribution than the present 
system. It is commonly assumed that the share which now falls to 
capital under the name of profits is very large, because such profits 
have been the source of many great individual fortunes. In this again 
it is not safe to reason except on the basis of facts. In many arts the 
share, or profit, falling to the capital invested may be equal to the 
whole sum of wages paid out in the conduct of the work ; yet this 



How Society Reforms Itself. 231 

profit may be but a very small fraction on each unit of product, and 
may represent but a very moderate percentage upon the capital used, 
in proportion to the risk taken. In almost all the primary processes 
in the production of metals, in many branches of metal-working, and 
in the textile arts, the capital required in the mills or works comes to a 
thousand dollars or more for every man or woman employed. Heavy 
stocks of material must be carried, from one half to three fourths of 
the value of the finished product may consist of the cost of the 
materials purchased, and the total annual product may not much 
exceed the amount of capital invested. In other arts, such as milling 
grain, packing meats, and the like, the cost of materials may come to 
even ninety per cent, or more of the value of the completed product ; 
hence even a mere fraction of profit on the outlay for material may 
amount to a larger sum than all the wages paid in that branch of pro- 
duction. If great fortunes are made on these small margins, it is 
because those special branches of work are the very ones which require 
not only the largest proportionate amount of capital but also the very 
greatest ability in the management. 

It follows that the ratio of profits to the work done is only that 
which will bring into the business the necessary capital and ability com- 
bined ; therefore any system which should propose to give to the work- 
man any share of this small margin, without his taking a corresponding 
share in the risk of loss, would of necessity result in restricting the work 
itself. Only those who are specially protected for a time by patents, 
by combinations or trusts, or by special legislation, can resist the ten- 
dency of profits to a minimum, because the competition of capital with 
capital works steadily toward the reduction of all profits to the measure 
of that rate which is necessary to attract capital and ability to the 
work, without which the work will not be undertaken at all. 

Many intelligent attempts have been made on the part of great 
capitalists or employers of labor to introduce the system of profit- 
sharing, according to the reformers' conception of that term, for the 
joint benefit of owner and workman alike. If such joint benefit had 
been the result, would not the system have become general ? Has it 
been found, as a rule, to promote an increase of product or a diminu- 
tion of work ? Has it added to the sum or mass of the product of the 
community ? Unless this method should either add to the present 
product of fifty cents' worth per head per day or reduce the cost of 
making that product, what effect would it have on the general condi- 
tion of society ? 

The advocate of protection to domestic industry by means of a tariff, 
alleges that the taxing of foreign imports will greatly increase the general 
product, and will in the long run diminish the cost of the protected 
article. This system may undoubtedly give a different direction to the 



232 The Industrial Progress of the N'ation. 

work of a particular community, ?jut is it not in the nature of things of 
very limited application ? In a given community of 6,000 people 
divided substantially like the example already given, 2,000 doing the 
whole work of the community, can more than from six to ten per cent, 
be found who now make or can make any thing which could be even 
in part imported from any foreign country ? If more, how many ? A 
glance at the distribution of occupations and a little thought given to 
the kind of work done by each class, may be all that is necessary to 
answer this question. Moreover, can the articles which are imported 
from a foreign country be paid for in any other way than by an ex- 
change for or export of domestic products ? Is not all international 
commerce of necessity a mere exchange of equivalents, unless when a 
foreign loan is negotiated ? In the community taken as an example, 
the export trade, corresponding to the import from without, appears 
to give employment to a greater number of persons than are occupied 
in the arts of which a part of the product can be imported. If this 
exchange of products is wholly or in part prevented by duties upon 
imports, will the final effect be to increase the general product of the 
whole community to a sum or mass more adequate than it is now ? If 
so, how much ? And how will the gain be distributed ? Will all get 
a share or only a few ? Will many pay the cost in order that some may 
gain ? Is not this system rather one which gives a different direction 
to industry than one which promotes an increase of the gross product ? 

On the other hand, the advocate of free trade alleges that if imports 
were not obstructed by taxation there would be a large addition to the 
general product of the whole country in consequence of this free ex- 
change, and thereby domestic industry would be most effectually pro- 
moted. But to him the question may be put. How large a market can 
you find for the excess of domestic products which we cannot consume 
at home ? How much would your domestic product be increased if 
there were no obstruction to the import of the crude or partly manu- 
factured commodities necessary in the processes of domestic industry ? 
If by admitting crude or partly manufactured products you add to the 
power of domestic manufacturers to supply the home market with 
finished goods, would you not then diminish the import of finished 
goods ? May you not then only alter the conditions of distribution > 
How much can you increase the general product of the whole community 
above fifty cents a head, or whatever it is now, by altering the condi- 
tions of foreign trade, in which perhaps less than twenty per cent, of 
the community can have any direct interest either as exporters or im- 
porters ? Must not exports and imports substantially correspond with 
each other in value, unless we become heavy borrowers of capital ? 
Would not foreign exports soon cease if we demanded only coin in 
exchange ? Would not one or two years' trade drain every bank in 
Europe, and if we secured the coin, should we have any use for so 



How Society Reforms Itself. 233 

large a quantity in our domestic traffic ? If the whole volume of im- 
port and export constitutes but a small part of the total traffic of this 
country, does not the tariff question become one of the minor forces 
rather than a prime factor ? 

Yet although our foreign traffic may not be a prime factor in ma- 
terial welfare, is it not a sort of balance-wheel on which the steady and 
continuous movement of the exchange of all domestic products among 
ourselves must mainly depend ? It is doubtless true that the home 
market takes by far the greater part of the products of agriculture, but 
is not the price established by what even a small excess will bring for 
export ? It is true that while the manufacturing portion of the com- 
munity are large consumers of foreign products, farmers and farm 
laborers are the largest consumers of manufactured goods. If domes- 
tic manufactures are promoted ia any suitable manner, doubtless the 
demand for farm products may also be increased ; but if the method 
of promoting domestic manufactures is one w^hich stops or diminishes 
the export of farm products, will not the demand for farm products, of 
which our exports mainly consist, be correspondingly reduced ? Can 
the farmers be then as good customers for domestic manufactures ? 
Would they gain as much or as rapidly in the home demand as they 
might lose on the foreign sales ? 

Now, since the excess of our farm products cannot be sold for coin 
only, and can be disposed of only in exchange for foreign goods, does 
it not follow that any obstruction to the import of foreign goods also 
checks the export of farm products, and diminishes the power of the 
farmers and farm laborers to buy domestic manufactures ? If a 
method of promoting domestic manufactures is adopted which di- 
minishes the power of the principal consumers of manufactured 
goods to buy them, may not this system work a grave injury even to 
those for whose benefit it was instituted ? These conditions must be 
considered in all their bearings before one can determine whether any 
thing can be added to the fifty cents' worth a day, more or less, of our 
products, by attempting to give one direction rather than another to 
the industry of the country my means of tariff legislation. 

In the community of 6, coo people which we have taken as an ex- 
ample, of whom 2,000 are occupied for gain, 870 are farmers and farm 
laborers. If we divide persons by the proportion of the value of the 
different products of agriculture, it will appear that not exceeding five 
per cent, of the farmers of the United States, or 44 of the 870 em- 
ployed in agriculture in our typical example, are occupied in the pro- 
duction of sugar, tobacco, flax, hemp, wool, and a few other articles 
which could be imported in part from any other foreign country 
except Canada. We now sell more products of agriculture to Canada 
than we buy from that country, therefore Canada may be left out of 
this consideration. On the other band, from 160 to 180 of each 870 



234 T^f^^ Industrial Progress of the Nation. 

persons occupied in agriculture in 1880, depended wholly upon a for- 
eign market for the sale of their product. 

Again, the whole number of persons occupied for gain in work 
done in factories, mines, and metal works, — that is, those who are com- 
monly called manufacturers, — is 230 in our example ; and the product 
of 30 or 40 of these is exported. How many of those engaged in the 
manufacturing arts are employed upon products which could be in 
part imported ? This question cannot be answered until the crude or 
partly manufactured materials of foreign origin which enter into the 
processes of their work are free from taxation ; such as wool, ores, 
iron, steel, hemp, timber, chemicals, dyestuffs, tin plates, as well as 
the machinery with which they work. 

No one can rightly measure the power of this community, not only 
to supply itself with manufactures but also to supply foreign nations 
with manufactured goods, until the disparity in the cost of materials 
which ensues from the taxation on imports of these materials is 
removed. All other machine-using nations, with hardly any excep- 
tion, admit free of duty the crude or partly finished materials which 
are necessary in the final processes of manufacturing. We do not ; 
therefore we have as yet had no experience by which we can test our 
own power either to supply our own markets or to supply foreign 
•countries with finished goods. When this fact is considered, the 
difficulty of measuring the effect of tariff legislation, either in pro- 
moting or in obstructing the work of a part of the people of this 
country, begins to be apparent. 

The tendency of invention and of the application of science to 
production and distribution, is to reduce all prices, to raise all wages, 
and to diminish the proportion of the product secured by capital in 
the form of profits. Does not any disparity or disadvantage in the 
■cost of materials which enter into the processes of domestic industry 
become greater as the absolute prices of the materials are reduced 
both in this and in other countries ? 

In the community of 6,000 people taken as an example, the pro- 
portion of the imports of foreign goods (valued at $75,000) taken in 
exchange for exports would be about as follows, on the basis of im- 
ports for the last decade : 

A Articles of food, or live animals 32 per cent. $24,000 

B Articles in a crude condition which are necessary 

in the processes of domestic industry 23 " " 17,250 

C Articles in a partly manufactured condition which 

are required for use in domestic manufactures 12 " " 9,000 

D Articles fully manufactured ready for consumption 21 " " • 15, 75° 

E Articles of luxury or of voluntary use 12 " " 9,000 

100 $75,000 



How Society Reforms Itself. 235 

It will be observed that the taxes imposed upon Classes A, B, and 
C, omitting D and E, in the community of 6,000 people, came to $12,- 
500 out of $24,000, collected in the form of duties upon imports. What 
would be the power of such a community to sell its finished products 
outside its own limits if this disparity were removed ? The burden of 
a tax is not in its actual ratio to the value of the taxed product, but in 
its ratio to the profit which might be made in making use of that taxed 
product as a component material in other manufactures. Can any one 
measure the power of this typical community until the disparity in the 
price of iron, machinery, tools, timber, steel, wool, hernp,.flax, and other 
crude materials shall be removed, by which it is now placed at a disad- 
vantage in competing with other communities ? 

Again, how can greater mischief be done than by bad methods, even 
of removing bad taxes, except by the bad system under which they 
have been imposed ? Were this question to arise in a small community 
of sensible people, it might not be made the dividing line between 
political parties, but it would be assigned to or taken up by men of 
common-sense and sagacity, by whom the system of providing revenue 
by duties would be adjusted from time to time according to the new 
conditions developed by invention and science, and not according to 
the prejudices inherited from other times or according to the supposed 
behest of partisan requirements. It may well be that after a direction 
has been given to the work of large numbers of people even by a badly 
adjusted tariff, the utmost care and judgment are called for in chan- 
ging it, lest the loss of capital caused by the change should come to more 
than the benefit. It is not true, on the other hand, that as legislation 
is now conducted the work is mainly done by those who have little 
knowledge of the facts and no convictions in regard to economic theo- 
ries based on adequate investigation of any kind ? What else, then, can 
happen but a perversion of public trust to purposes of private gain, 
even by ways of which the legislators themselves have no conception ? 

Again, taking no cognizance of the general question of protection 
and free trade, and limiting our considerations to our relations with the 
neighboring Dominion of Canada, with -which we have lately been in 
danger of a quarrel, what do we find ? It is alleged by those who 
oppose the free importation of fish, potatoes, and other articles of 
food, or of timber, ore, and fuel from Canada, that if the exchange 
of Canadian products for our own is stopped, then the people of the 
United States will be better off and will have more work to do. It may 
be admitted that, under these conditions, they will have more work to 
do. That is not the true question. Would they get more for their 
work if these articles imported from Canada were not taxed, than they 
get now that they are taxed ? We cannot buy from Canada for money 
only, any more than Canada can buy from us for money only ; there 



236 The Industrial Progress of the Nation. 

must be an exchange of products. If we should exchange with Canada. 
the kind of provisions, coal, and goods that we want less, and get from. 
Canada the kind of food, the fuel, the ore, and the timber that we want 
more, might not the product of each country be increased in the meas- 
ure of the gain on such exchange ? Would not the wage and profit 
fund thus become greater than it now is ? The whole country is dis- 
turbed over the fishery question. What is the measure of that ques- 
tion ? We now import about $300 worth of salt cod and smoked her- 
ring, chiefly from Canada, for each 6,000 people in the United States. 
The whole contest with Canada over the fisheries grows out of the 
determination of Congress to tax the consumers of fish $60 a year on 
each $300 worth of fish imported for the use of each community like 
that taken for an example. The revenue thus derived is not required ; 
it foirms a part of the surplus. The owners of the fishing-smacks of 
the United States employ two or three Canadians to one Yankee in 
catching fish, and the consumers of fish are taxed $60 a year on 
each $300 worth consumed by our people. That tax on fish is the 
whole cause of the quarrel with Canada on the fishery question. Each 
reader may compute for himself what would be the harm or what would 
be the benefit of removing the tax on fish, and also estimate the harm 
of keeping up a constant cause of irritation with our next neighbor in 
order to sustain this tax. The average interest of each family of five 
persons in the United States in salt cod and smoked herring imported 
from Canada, subject to duty, is twenty cents a year ; on which the 
revenue under the tariff is four cents, and this revenue is not required. 
When these facts are considered, does not the recent discussion of the 
fishery question become a subject of national humiliation ? Whether the 
treaty was a good one or not did not become apparent because the oppo- 
sition to ratification was conducted in such a way as to conceal the facts 
and to deprive the community of the means of forming a true judgment. 

We next come to the nostrum of " fiat " money. The advocate of 
fiat money, or of the unlimited coinage of low-priced silver, alleges 
that if we had more money in circulation wages would be higher, and 
then each man could buy more, because he would have more money to 
spend. Does not experience prove that all tampering with the stand- 
ard of value, which in the form of coin is made use of as an instru- 
ment of exchange, tends to diminish the production of articles neces- 
sary for consumption ? Have not all such undertakings ended in 
restricting credit, and therefore in diminishing the product and in 
raising prices much higher and much faster than wages have been 
advanced ? Is not credit one of the prime factors in abundant pro- 
duction ? 

Unless a large supply of so-called cheap money should mcrease 
the product above what fifty cents a day. will now buy, so that the 



How Society Reforms Itself. 237 

•greater quantity of money would purchase a still greater quantity of 
produce, might not the only effect be that the rich would become 
richer while the poor would become poorer, as has ever been the case 
when the stability of the standard of value has been tampered with by 
legislation or when the standard of value has been depreciated ? 

Is not the malignant influence of all depreciation in the value of 
the currency of a country to be found chiefly in its effect on credit ? 
Is not credit a prime factor in making prices ? If so, does not credit 
depend upon the quality rather than upon the quantity of the circu- 
lating medium ? What constitutes credit ? Does not the farmer who 
plants a crop, or the manufacturer who buys a stock of crude material, 
grant a credit to the future when he does so ? Will not all his under- 
takings be restricted when there is any doubt whether the money 
received for his product, after all his labor has been expended upon it, 
will be as good as that which he pays out for his labor at the begin- 
ning of the season ? Will not product then be diminished ? During 
the Civil War, when the greenback was depreciating, did not all private 
credit granted by one man to another finally cease ? Did not prices 
rise faster than wages ? 

The Prohibitionist says : " Stop drinking and everybody will be 
better off." This may be true ; it may perhaps be true that dram- 
drinking can be stopped by legislation ; but as yet the method does 
not appear to have been very successful. Let it, however, be admit- 
ted ; what does it come to ? The expenditure for liquor, in the manu- 
facture of which a certain part of the grain and other products of 
agriculture and a certain amount of fuel has been consumed, now 
averages about four cents per day per head of the population, or 
about $15 a year per capita. In the typical community of 6,000 peo- 
ple this would come to $90,000 a year, or seven and one half per cent, 
of the total product. To that extent a great benefit might ensue if 
the larger part of the force now expended or wasted in the production 
of spirits and beer could be employed in some other way. How can it 
be done ? It would involve the necessity of finding other occupation 
for the farmers and growers of grain and hops, and for the distillers 
and brewers, as well as for the dealers who now get their living 
"by providing liquor. To what extent would this change affect the 
community as a whole ? It is admitted that a large part of the crime 
and of the public expenditures for prisons and reformatories is due to 
intemperance ; but, on the other hand, if the statistics were accurately 
compiled, not only of those whose productive capacity is impaired by 
the use of liquor, but also of those whose productive capacity is not 
impaired by such use, or if the statistics were compiled of those who 
make a temperate or moderate use of liquor as compared to those who 
are intemperate, the percentage of intemperate persons and the per- 



238 The Industrial Progress of the Nation. 

centage of persons whose ability to work is impaired, would be small. 
If each reader will consider his own acquaintance, or the members of 
the community in which he lives, rich and poor, and take note of all 
who ever drink so much as to impair their productive energy, he will 
probably be surprised at the very small number and the very small 
percentage of the whole who will be included in that category. There- 
fore the question must be asked, To what extent would the disuse of 
liquor increase the product or improve the distribution of products 
now measured on the average at fifty cents' worth per head each day, 
more or less ? Is there not a greater waste in the use of food than 
there is even in the expenditure for drink ? Admitting to the fullest 
extent all that may be presented as to the bad effects of liquor, may it 
not be held that dyspepsia caused by bad cooking is as bad or even 
a worse evil, whether considered materially or morally, than the mod- 
erate consumption of lic^uors which constitutes their average use ? 

It has been my purpose in reciting these various proposed reforms 
by legislative methods or by special organizations, to present them in a 
way that will bring each to the test, by applying each one to the con- 
ditions of a small community and to the measure of the present average 
product of this country. It would be useless even to attempt to state 
the manifold bearings of any one of these so-called reforms in an article 
of moderate compass. I have therefore tried to present " the other 
side " in each case cited, and to put questions in such a way as may 
raise a doubt as to the efficacy of his special process, in the mind even 
of the most strenuous advocate of each legislative panacea for the 
admittedly narrow conditions under which we now exist. In the end, 
the common-sense of the people will seize upon and hold fast every 
element of truth that is to be found in each and all of these proposed 
reforms, and will reject all that is shallow, fallacious, or purely selfish. 
In that way society grows and reforms itself. 



X. 

REMEDIES FOR SOCIAL ILLS.' 

IN preceding articles I have endeavored to exhibit the relative con- 
ditions of an average community of 6,000 persons, and to apply to 
such community the various reforms which have been suggested by 
different parties in order to bring about an improvement in the general 
social state. I will not myself attempt to present or to invent any 
specific method by which the whole condition of society in this country 
may be changed. Bach man may perhaps do a little to remedy existing 
faults, but he who undertakes to solve all these social questions may 
perhaps fmd that communities grow and are not made to order. 

A rather prosaic suggestion can perhaps properly be submitted. It 
is a well ascertained fact that, with respect to about ninety per cent, of 
the community, the price paid for food comes to one half the income 
or more. After this food is bought, how much of it is wasted in bad 
cooking ? How much human force is wasted in consequence of bad 
cooking ? How much docs dyspepsia or indigestion, caused by bad 
cooking, impair the working capacity of the people of the United States 
and diminish their product ? Perhaps the reader can observe and 
measure, or at least guess, what is the waste of food and fuel in the 
1,200 families of five persons each, more or less, constituting the com- 
munity of 6,000 persons who live near him. How many cooks are 
there who know what food to buy and how to cook it ? In any 1,200 
average families, more than 1,000 spend one half their income or more 
for food and fuel ; the less the income the greater the proportion spent 
for food. 

Next, let the reader think for himself whether five cents a day per 
head could be saved in his own family, or in his neighbors' families, or 
on the average whether the waste of the 1,200 families nearest him 
amounts to five cents a day per capita. If all the women were good 
cooks and knew what to buy and how to prepare food in a judicious 
and appetizing way, would the saving be five cents a day per head ? 
If not, how much ? One will probably find that the average expendi- 
ture for each person, man, woman, and child above ten (two under tea 
' Reprinted from the J'orum. 
239 



QUESTIONS OF THE DAY 

44 — The Present Condition of Economic Science, and the Demand 

for a Radical Change in Its Methods and Aims. By 

Edward C. Lunt. Octavo, cloth 75 

45— The Old South and The New. By Hon. W. D. Kelley. 

Octavo, cloth . . . . . . . . . I 25 

46 — Property in Land. An essay on the Nevi^ Crusade. By Henry 

Winn. Octavo, paper ....... 25 

47— The Tariff History of the United States. By F. W. Taussig. 

Octavo, cloth . . . . . . . . . I 25 

48 — The President's Message, 1887. With Annotations by R. R. 

BowKER. Octavo, paper 25 

49 — Essays on Practical Politics, By Theodore Roosevelt. 

Octavo, paper ......... 40 

50 — Friendly Letters to American Farmers and Others. By J. S. 

Moore. Octavo, paper ....... 25 

51 — American Prisons in the Tenth United States Census. By 

, Frederick Howard Wines. Octavo, paper, ... 25 

52 — Tariff Chats. By Henry J. Philpott. Octavo, paper . 25 

53 — The Tariff and its Evils ; or, Protection which does not Protect. 

By John H. Allen. Octavo, cloth i 00 

54 — Relation of the Tariff to Wages. By David A. Wells. Octavo, 

paper .25 

55 — True or False Finance. The Issue of 1888. By A Tax-payer. 

Octavo, paper ......... 25 

56 — Outlines of a New Science. By E. J. Donnell. Svo, cloth, i 00 
57 — The Plantation Negro as a Freeman. By Philip A. Bruce. 

Octavo, cloth I 25 

58 — Politics as a Duty and as a Career. Octavo, paper . 25 

59— Monopolies and the People. By Chas. W. Baker. Svo, cloth, i 25 
60 — Public Regulation of Railways. By W. D. Dabney. i2mo, 

cloth 1 25 

61 — Railway Secrecy and Trusts. By John M. Bonham. Svo, 

cloth I 00 



G. P. PUTNAM'S SONS, Publishers, New York and London. 



2 40 The Industrial Progress of the jVat/on. 

counted as one), for food and fuel, is about 25 cents a day. In recent 
years it may have been a little less, but prices are now rising ; a few 
years since it was a little more. Can five cents' worth per day be 
saved ? Is not that a very insufficient measure of the difference be- 
tween a poor, wasteful cook and a good, economical one? If five cents 
a dav can be saved on food and fuel, while at the same time that which 
is bought and cooked may be converted into more nutritious and appe- 
tizing food, the difference in each community of 6,000 people would be 
^109,500 a year, or about nine per cent, of the total product of the 
typical community, which we have assumed to be $1,200,000 a year in 
gross, ^^'hen viewed in this light, it may happen that reform in the art 
of domestic cooking ought to have taken the first place in the list of 
proposed reforms alread)- given. Can the anarchist, the communist, 
the socialist, the protectionist, the free-trader, the co-operator, the 
paper-money man, the knight of labor, the eight-hour man, or the 
sentimentalist invent or suggest any other method of changing the 
direction of the industry of the whole community which would on the 
whole be so effective in improving the conditions of all, as one which 
would save five cents a day on food and fuel, the money saved to be 
devoted to providing better houses in which people may live ? If the 
waste of food and of liquor could be saved and directed or converted 
into shelter, by providing better dwelling-places for the community, 
would not the space or number of rooms now occupied on the average 
bv each familv be nearly doubled ? Could not the sanitary conditions 
be made wholesome ? Might not the slums of the great cities be 
cleaned out and the nuisance forever after abated ? Can this be done 
bv collective or state process or by individual action ? The writer has 
been held up to much obloquy for an attempt to give this direction to 
some of the reforms of the present day. Such abuse or objection has 
usually come from those who get their living by misleading ignorant 
people as to what their true interest really is ; it is therefore of no 
consequence. 

Real life consists in the conversion of force ; that is to say, in the 
work, whether mental, mechanical, or manual, which is exerted in 
giving a direction to the natural forces by which life is sustained. 
Whether or not the averages which have been given correspond 
identically to the average product and consumption or conversion of 
force of the whole country, is immaterial. The margin for error is in 
any event very small ; in all large communities great numbers may 
be found whose conditions, reported upon by state bureaus, correspond 
verv closely to the figures which have been submitted in this essay on 
a unit of one typical community numbering 6,000 people. This ideal 
communitv really exists somewhere in fact. If you could only find it, 
Avhat would you do to improve the conditions ? 



Remedies for Social Ills. 241 

Perhaps a yet better example, and one more easily comprehended, 
may be found by considering the condition of an average family of six 
persons, a man, his wife, and four children ; the man himself and one 
child doing the work corresponding to one in three of the present 
population by whose work subsistence, shelter, and clothing are now 
gained for all. We will assume that this man is a good mechanic, 
earning the average pay of such men in the Eastern or Middle States ; 
the son or daughter works in a factory on fancy weaving at the highest 
price, and earns about $1.20 a day. The income of the two persons 
on whom the six depend would be as follows : 

300 days' work of the man, at $3.00 a day $900.00 

300 " " one child, at about $1.20 a day 350.00 

Total income $1,250.00 

Food for six persons, at 25 cts. each per day, $91.25 per year, 

in round figures $550.00 

Clothing, 7 cts. each per day, $25.55 P^r ye^'' 150.00 

Fuel, oil, and household sundries, 3 cts. each person per day, 

$10.95 per year 65.00 

Sundries for personal use, 5 cts. each per day, $18.25 per year, 110.00 

Rent, 9 cts. each per day, $33.00 per year 200.00 

Deposit in savings-bank, each person or fraction over 2 cts. per 

day, $7.30 per year, say 50.00 

Average proportion of all taxes, a little less than 3 cts. per day 

for each person, $10.00 per year 60.00 

Profit upon their work, or contribution to capital at ratio of 
ten per cent, on gross value of their product, 5 cts. ; 2 cts. 
having already been set aside for the profit of the workman, 
there remains 3 cts. per head per day compensation for the 
use of capital, $10.95 per year 65.00 

Total $1,250.00 

The two persons occupied for gain in this group of six are therefore 
credited with the average production of $625.00 each per year, or a 
little over $208.33 P^^ y^^^" P^r capita, which comes to a fraction over 
57 cents per day to each person. 

In what way can this family improve its condition, or in what way 
can its condition be improved, either by legislation or in any other 
manner ? The man owns or occupies a house ; the valuation of the 
land is half that of the house and land ; the rental of the whole is $200 
a year. If he owns the house he can put aside what he would other- 
wise pay for rent, or he can spend it for more comfortable living ; this 
implies private property or possession of land. If he does not own his 
house, he must either pay rent for it to a private owner, or, if the single 
tax on land should be carried out, he must pay proportionately more 

than the same amount in the form of a tax on the land to the city or 

J 6 



242 Tlie Iitdustrial Progress of the Nation. 

State that he now pays to a private person for rent of land. He is 
employed by a capitalist ; if he can do better and can earn more by 
working for himself than for the capitalist, so that he gets no service 
from the capitalist, he need not pay the profit of $65 assigned as com- 
pensation to capital, but he can save it or spend it. If he saves that 
sum himself it is to his benefit. If by working for the capitalist he 
makes more for himself than the $65 paid by him for the service of 
capital comes to, then he may gain the difference by working for a 
capitalist. Capital has no means of compelling him to work in its 
service, and he has no way open to him to force capital to work for 
his benefit without contributing to its profit. He only can save a part 
of his taxes, however collected, by watching the expenditures and 
voting only for those who will spend the public revenues', national, 
State, or city, in a proper way for the common benefit of the whole 
people. 

The quantity of materials for clothing that each person requires for 
comfort and welfare does not vary greatly whether the man be rich or 
poor. The rich man may possess more clothes at one time ; but he 
does not wear them out so fast ; the workman on the whole wears out 
more clothes than the rich man ; the difference, however, in the neces- 
sary supply of clothing is not great, and would not affect the general 
cost of living to any very great extent. The average expenditure for 
fuel and oil does not vary in any great measure, and this element of the 
cost of living is not large ; therefore in this the margin for economy is 
not great. 

With respect to food, each average person, rich or poor, absolutely 
requires the same proportions of nitrogenized substances, starch, and 
fat, or of the so-called " nutrients." Each adult person requires sub- 
stantially the same quantity of food, varying a little with the work 
done ; the man who is engaged at hard labor requires and can digest a 
greater quantity than the rich man. In quantity rightly consumed, 
therefore, little economy or saving may be expected or desired ; the 
saving is to be made by right selection of the materials, and by avoid- 
ing waste in the preparation and in the consumption of food. In this 
direction there is a very large margin for saving. 

The greatest inequalities and the greatest variation in the condi- 
tions of men are to be found in their dwelling-places ; it is for this rea- 
son that the land question has become so intimately connected with the 
labor question. But it is evident that whatever theories may be adopted 
by the state in granting the conditional possession of land to individ- 
uals, there must be a certain measure of private occupancy, namely, 
possession or use of land for a dvvelling-place. Compensation must 
then be made to some authority for the choice or selection of land, 
either in the form of rent or in the form of taxes upon land values. 



Remedies for Social Ills. 243 

The selection or choice and the possession of land having been pro- 
vided in some way, the occupant must then either be capable of build- 
ing his own house, or he must pay some one else to build it ; otherwise 
he must hire a house. He can accomplish neither pujpose without cost, 
and he can accomplish neither without subjecting himself to a charge 
for the service of capital, unless he accepts charity and is housed in an 
almshouse. 

In what way can this typical family improve the condition of its 
dwelling-place ? If little can be saved on the proportionate expendi- 
ture either for clothing, for fuel, for light, or for sundries, and if some- 
thing, however small, ought to be set aside against a rainy day, does it 
not follow that the only method open to this man and his family at the 
present time for improving their condition, is by economy in the purchase 
and right use of food and drink ? Is it not true that better results can 
be obtained — a more appetizing quality imparted to the food, and 
more adequate nutrition derived — from twenty cents' worth of food 
well-cooked, than from twenty-five cents' worth of the same food 
cooked and served as it commonly is ? In this typical family $200 
a year has been assigned either to the payment of rent or to the rental 
value of the land and dwelling occupied. Five cents a day saved on the 
food of each member would amouijt to $109.50 a year, which might be 
converted into rent or rental value. If a part of the members of the 
family now spend a sum equal to four cents a day for each member for 
liquor, the average of the whole country for liquor and tobacco being 
over four cents per capita, then a saving of one half of this sum would 
come to $43.80, which, added to the saving on food, makes $153.30. 
By this different direction or expenditure of force, the amount first 
assigned to providing a dwelling-place could be increased seventy-five 
per cent. The $200 assigned to providing shelter in some way would 
be increased to $353.30 per year. Is this a practicable reform ? 

When the attention of the labor reformer is brought down from 
glittering generalities and grand schemes for altering the whole consti- 
tution of society by act of Congress or of the State legislature, to the 
simple question of how each person, each family, or each community 
may better itself under existing conditions, great progress will have 
been made in solving all the problems which are now pending. The 
professional agitator, who gets his living by misleading the uninformed, 
may scout at personal economy and ridicule the only available methods 
by which any true progress can be made in leading the great mass of 
the people to a higher plane of general comfort and welfare. It does 
not matter. Whatever may be the temporary influence of quacks, sen- 
timentalists, professional agitators, and silly novelists, the solid common- 
sense of the community ultimately controls events, and in a rather slow 
and indirect way works out for itself its own methods of reform. 



244 The Industrial Progress of the Nation. 

In each presidential election the orators of the two parties have for 
many years predicted the utter ruin of this country unless their own 
side should prevail. But the ruin has never come — quite the reverse. 
Witness the figures given under the head of '* Progress from Poverty " 
in one of the preceding articles. For a time it seemed possible that 
a few unscrupulous men, whose power and influence rested upon human 
slavery, might succeed in their nefarious purpose of re-opening the 
slave-trade and continuing to subject the whole country to their malig- 
nant control, but even they utterly failed ; the principle of liberty, 
which was established by the common ancestors of those who dwell in 
the South as well as in the North, was too strong for them. None are 
now so ready to admit that the great result of the war by which slavery 
destroyed itself, has been the emancipation of the white man through 
liberty given to the black man. Compared to this destructive force of 
slavery, by which the product of the whole country was limited and 
the equitable distribution of products impeded, there is no material 
cause of danger of any great moment now existing. We have already 
paid two thirds of the national debt, and by the application of science 
and invention, especially to the railway service, it has been paid with- 
out any man being called upon to work harder than he did before the 
debt existed. The danger point in our system of currency was passed 
when President Grant vetoed the inflation bill. Whether we will or 
not, the currency of the United States may soon be sustained by specie, 
dollar for dollar, through the liquidation of the demand debt, now rep- 
resented by legal-tender notes, as these notes fall in by way of taxation. 

The most important question now pending relates to the right 
method of raising that part of the national revenue which for a long 
period must be derived from duties on imports. This is one of the 
minor questions, very important in its place, but probably not of the 
grave importance customarily attributed to it. The country will 
prosper, however the taxes may be collected. What the moral effect of 
a bad method of raising the national debt may be, it is not the present 
purpose of the writer to treat. When the most important question in 
a country is how to reduce its taxes to the level of its expenditures, the 
country cannot be very hard pressed. 

The continental system of absolute free trade, which exists among 
the States of our Union over a larger area and among a greater number 
of people than are now enjoying or were ever permitted to enjoy it 
elsewhere, renders our foreign commerce relatively unimportant. The 
real force that governs this country is more powerful than any Congress 
or system of legislation. That force may be obstructed by bad statutes, 
or may be made to work more rapidly by wise political methods ; in 
the end, however, it holds its sway. That force is the solid common- 
sense and enlightened self-interest of the whole community. 



Remedies for Social Ills. 245 

I have endeavored in various essays to present a true picture of the 
gain in individual wealth and in the means of common welfare in the 
few years which have elapsed since the nation proved true to the 
principle of personal liberty on which it was founded ; I have also 
endeavored to show that material abundance is well assured to all who 
choose to meet the conditions which will entitle them to share it. 
There are other dangers which may not be rightly or foully treated in 
this essay. Having cast out one devil, there may be a danger that we 
shall admit seven others by whom our personal liberty may be restricted 
or taken from us. Legislation, whose true purpose should be only to 
promote justice and to give equal opportunity to every one, may be 
perverted so as to bring about an unjust distribution of the means of 
subsistence, and to deprive great bodies of men and women of equal 
opportunity to attain their common welfare. On the one side the 
national Congress may continue its attempt to obstruct our foreign 
commerce by one set of statutes, and may render the domestic traffic 
over our railways more costly than it need be by other statutes. State 
legislators may continue to limit the power of adults in the disposal of 
their own time — the only element in life that all might enjoy in com- 
mon except for such restrictions. 

Yet more subtle restrictions upon individual lioerty, affecting all 
the methods of production and distribution, may continue to be im- 
posed by secret societies. The man who chooses to maintain his own 
liberty and to make his own contracts in his own way, may for a time 
be denounced as a ''''scab "y but even as the obnoxious title of Yankee 
applied by the British troops, has been assumed by the people of New 
England as one to be proud of, so the workman who maintains his own 
personal liberty may presently assume the title of scab as a true testi- 
monial to his. right position and true evidence of the method by which 
he has attained the advantage of position without harm, but to the 
benefit of his fellow-workmen. The effect of these various restrictions 
upon personal liberty may be to prevent the abundance of the means 
of subsistence becoming as ample as it might be, and may continue to 
take from the many a part of the fruits of their labor for the benefit 
of the few. Yet this country has been endowed with such abundant 
resources that we shall continue to thrive in spite of the blunders of 
legislators and the interference of labor associations, whose objects 
may be as right as their methods of attaining them are wrong. 

On the other hand, there has never been a period in the history of 
any country when so much attention has been given to the study of the 
forces which make for abundance and welfare. Before many years it 
may become apparent to all that the only way to raise the general 
standard of living and to benefit the community as a whole, is to de- 
velop the personal character and capacity of each and every member of 



246 The Ifidustrial Progress of the Nation. 

it. The primary source of all wealth is in the manual and mechanical 
work done by the many under the mental direction of the few by whom 
all are served. The stream cannot rise higher than its source, and if 
the many remain ignorant and incapable of taking advantage of the 
opportunities which science and invention have placed at their com- 
mand for developing the products of our mother-earth in ever- 
increasing measure, then even a low standard of subsistence may with 
difficulty be attained, and the hardships to which many may still be 
subjected will continue to be imposed upon them by their own inca- 
pacity. The mind of man is the potent factor in material production ; 
character counts for more than capital in getting a living. He lives 
best, even in a material sense, and he earns the most leisure for him- 
self, who, by the use either of his brain or his capital, while serving 
himself at the same time raises the earnings of the workman to the 
highest point by reducing the cost of production to the lowest. The 
dollars of the gain which the capitalist earns under these conditions are 
but a tithe upon the service which he has rendered to all. 

The open secret which few yet seem to comprehend, although all 
act consistently with it unless restricted by statute or by trade by-law, 
is that not only the individual wealth but the common welfare of men 
and of nations, are attained in most ample measure through inter- 
dependence and not through independence. 



THEORY AND PRACTICE. 

SUPPLEMENT TO NO. lO OF THE " FORUM " SERIES. 

HAVING been led through devious ways to the conclusion that 
the greatest gain which can now be secured to society as a 
whole, is not by legislation, not even by remission of taxes, 
not even by saving a considerable part of the absurd waste by fire, but 
by teaching society as a whole how to prepare food in the process of 
cooking after the food has been provided, it would seem as if this 
series of articles would be incomplete without a treatise in which the 
practical application of the theories presented may be made and a 
remedy suggested. 

One of the greatest embarrassments even to one who may have been 
called in early years to practise close economy in the art of living, but 
who is no longer under any absolute necessity to do so, is to meet the 
rejoinders of working men to whom he attempts to give any informa- 
tion, somewhat in the following form : 

" We cannot look forward to any great change in our condition ; we have been too 
long devoted to one kind of work in one department to see much chance for progress ; 
we do not want to be lifted out of our present sphere and separated from our fellow 
workmen, and we could not be if we would, it is too late ; we must stay where we are ; 
and we are in some danger even of having our own s-pecial work invented out of exist- 
tence by some new machine or other ; we can hiarely make both ends meet at the end 
of the year as things now are ; it is all very well for you to talk about economy, you 
have two or three big rooms for each member of your family ; we have only one little 
room for every two or three members of our families, and we are so crowded now that 
we jostle each other ; yet we miLst go on in the old way, and we must stand by each 
other in our own trade and try to get all we can. All you tell us may do very well for 
one who can wait, and who can choose what his work shall be. We can neither wait 
nor choose ; here we are, and here we must stay whether ye want to or not. If you 
think any one can live on ten cents' worth of food a day, try it yourself if you want to. 
We don't want to, we don't mean to, and we can't afford to. We have n't much time, 
and we must buy food that can be cooked quickly." 

Underneath this very honest statement of the difficulties of life 
there is also often an undercurrent which crops out, somewhat in this 
form : 

' ' We work for all that you get as well as for what we get ourselves, why should n't 
we have as good food as you do ? " 

247 



248 The Industrial Progress of the Nation, 

If the capitalist did not add more than he takes away from the 
common stock, there would be more force in these objections ; the 
great difficulty is in bringing about a right understanding among the 
different classes of society ; as I have said in one of the previous- 
essays, the one thing most needful is for the rich man to learn how the 
poor man lives, and for the poor man to learn how the rich man works. 

There is but one reply to this sort of rejoinder of the workmen. 
All that can be said to them is this : 

" If you do not learn how to get the most comfort out of what you now earn, there 
will certainly be very little chance that you will ever learn how to earn any more. The 
only way to a condition in life in which you may be able to spend twice as much as is 
necessary for food for every day, is to learn how to get as much as you can out of the 
money that you can now afford to spend. If you want to be able to spend fifty cents, 
a day, the way to it is to learn how to live on ten cents' worth of food a day. If you 
are crowded together because you cannot afford to own or to hire a good house, and 
yet spend twice as much for food as you need to, would n't it be better to save one 
half the cost of food if you can, and yet get as much comfort out of what you do spend 
as you now do, and then spend twice as much for a dwelling-house." 

The average rent of the workman is seldom more than one third tO' 
one half the cost of the materials for food. If the workman can save 
one third to one half the cost of the materials for food and yet be bet- 
ter nourished, he can then improve his dwelling-place in just that 
measure. A man who knows just how to do it, and who chooses tO' 
give the time which is necessary to the food question, can without a 
doubt maintain himself in vigorous health and strength on ten cents' 
worth of food a day ; but there are probably very few persons who can 
afford to do so ; it may cost more in time and trouble to live on ten 
cents a day than it does to spend twenty cents ; most people had rather 
spend more than ten cents a day if they have it to spend, and get 
more variety of food for their money ; but the great misfortune is that 
most working people spend twenty or thirty cents a day for their food 
and do not get over ten cents' worth of satisfaction or nourishment 
out of it because they put good materials to a very poor use. In order 
to enable those who choose to save a part of the waste of food, the 
writer has attempted to put his own theories into practice, and in the 
following article, which is reprinted from the June number of Lend a 
Hand, he has attempted to tell how to do it. 

There is one satisfaction in the invention of the ovens referred to 
in this article ; if their use may not improve the condition of the poor, 
it may at least greatly ameliorate the condition of the rich. If the 
ovens which are described are used under the direction of a person 
of moderate intelligence, it is almost impossible even for a poor cook 
to spoil good food ; again those who do not wish to have a hot 
kitchen, especially in summer, may cook their own dinners in a cool 
dining-room without altering the temperature by more than one degree. 



Theory and Practice. 249 

The information is offered for whatever it may be worth ; and this 
chapter forms a fit conclusion to a series of articles in which the ruling 
idea has been that every man makes his own rate of wages by the 
amount of intelligence that he puts into the work that he is called upon 
to do. This rule works both in the earning and in the spending of the 

' See page 339, " The Missing Science." 



WHAT SHALL BE TAXED ? WHAT SHALL 
BE EXEMPT ? 



WHAT SHALL BE TAXED? WHAT SHALL BE 

EXEMPT? 

WHILE revising the foregoing series of articles, which were first 
printed in The Forum, for republication in book form, I 
have been reminded that my treatment of the subject of 
protection and free trade has been subjected to adverse criticism by 
the advocates of both lines of policy. That might be held to prove 
that I had at least succeeded in part in what I had undertaken to do 
through the medium of the magazines, viz., to incite an intelligent dis- 
cussion of the tariff and other economic questions, in place of the com- 
mon vituperative method which is so customary among those who may 
have no intelligent basis for what they call their opinions, and who are 
therefore accustomed to cover their real want of any knowledge of the 
subject by imputing ignorance or bad motives to their opponents on 
either side of the question. 

There is now no difference of opinion among the intelligent advo- 
cates of protection and the reasonable advocates of freer trade at pres- 
ent leading up to actual free trade in the future, as to the final pur- 
pose to which all legislation ought now to be directed. That objective 
point is the establishment of a system of commerce with other nations 
which shall ultimately be as free from taxation under the form of a 
tariff of duties on imports, as the necessity of the nation for a revenue 
from such duties will permit ; such point to be attained as soon as the 
conditions precedent can be established which will admit such objective 
point being reached. 

Both sides, therefore, seek the same end, differing only as to time 
and method, with the exception of a few persons who advocate na- 
tional isolation by means of " a tariff for protection with incidental 
revenue." They are, however, so few in number, and of such feeble 
influence intellectually, that they need not be considered by those who 
treat the subject seriously and who are free from mere partisan bias. 

The main difference between the advocates of protection and free 
trade at the present date is upon the question of time and method in 
reducing the present tariff, and in regard to the subjects from which 
the present excess of taxation shall be first removed. The difference 

253 



2 54 ^^^ Industrial Progress of the Nation. 

is therefore one of detail, both seeking to promote domestic industry in 
the most effective manner known to them. Cannot an agreement be 
reached under such conditions ? 

The basis of the protective theory among those who intelligently 
and reasonably sustain it is this : 

I St. It has been held by them that a nation should develop within 
its own limits the power or ability to supply itself with the necessaries 
of life without recourse to imports from other countries. 

This view has been very urgently sustained in respect to articles 
which are necessary not only in time of peace, but which are even more 
urgently required in time of war ; the absolute requirements of war be- 
ing food, clothing, and arms, /. e., fabrics made of wool, iron, and steel. 

2d. It has been or is held, that even aside from the necessities of 
war, a nation should render itself independent of all others, and should 
become capable of supplying itself with all the necessaries of life, if the 
crude materials for such supply exist within the limits of its territory 
and can be worked, either in the soil, the mine, or the forest. 

3d. It is held that in developing the processes for converting these 
crude materials into their final forms ready for consumption, a great 
diversity of occupation may be promoted ; and that while free trade 
may be the true objective point, it cannot be adopted safely until such 
conditions precedent have been established as may enable the domestic 
manufacturers or converters of crude materials into finished goods to 
compete with foreign countries on even terms. 

4th. Lastly, it is now held by the advocates of protection, that in 
consequence of the higher rates of wages which prevail in this country 
as compared to foreign countries in certain specific arts, we cannot 
yet compete with foreign countries in these arts, if the free-trade policy 
should now be adopted. In support of this proposition, it is held that 
the rates of wages are a true standard by which the cost of goods may 
be compared. 

In addition to these principal reasons for placing duties on foreign 
imports at higher rates than those which would yield the largest reve- 
nue at the lowest rates on selected subjects of taxation which are not 
of necessary use in domestic industry, it has been held that by means 
of such duties or under the protective system, so-called, additional 
work may be provided for the people of a given nation, through the di- 
versity of occupations supposed to be greatly promoted by this system. 

In conclusion of the whole matter, it has been and is held, that al- 
though the first effect of placing protective duties on foreign imports 
must be to keep the prices both of the domestic product and of the 
foreign import of like kind, higher than they would be except for such 
duties, yet the ultimate effect of the system must be to reduce such 
prices and to furnish a greater abundance to consumers at less cost. 



What Shall be Taxed? What Shall be Exempt? 255 

This is the principal justification of the system in the minds of those 
who sustain it, to wit, that at the cost of a temporary higher price, 
lower prices will be finally attained. 

Such is, I think, a fair statement of the argument for what is called 
protection to domestic industry by way of the imposition of taxes on 
foreign imports, commonly called duties. 

It is also held by a few persons, even some holding quite conspicu- 
ous positions, that by way of duties on imports foreign nations may be 
made to pay revenue to this country. Such an argument hardly calls 
for serious consideration, as it could never be put forward by any one 
conversant with commerce. It is based on the admitted fact that, if 
the duties imposed should so obstruct our demand upon a foreign 
country for a given article, this obstruction, in place of raising the price 
at home, may depress the price abroad, and this depression of price is 
said to be the same as putting our tax upon other people ! In point of 
fact this lowering of foreign prices is one of the most injurious effects 
of a mistaken policy, especially when it affects the crude or partly man- 
ufactured articles which are used in the mechanical and manufacturing 
arts, as it gives the foreign manufacturer an advantage over our own 
which cannot be overcome. See the subsequent figures on iron and steel. 

One may not hastily and dogmatically pronounce all these proposi- 
tions to be without any foundation ; and it is both useless and mis- 
chievous to denounce those who present such views as being mere 
spoliators, or to say that they are striving as a body to sujjport 
themselves and those whom they employ at the cost of their neighbors, 
without rendering any true service in return. These views have been, 
and are now, held in perfect sincerity and integrity by many of the 
most upright citizens in this country ; they are still believed to be 
sound by a very large number of intelligent men, who sustain them 
without any other purpose than because they fully believe that the 
welfare of the nation depends upon their being sustained. 

Unquestionably there are among the supporters of protection many 
persons whose own interests are to themselves so paramount in the 
matter — or are believed by them to be so paramount in their relation 
to others, — as to obscure all consideration of the public welfare ; as 
there are also, on the other side, advocates of free trade who would 
break down all barriers to immediate free exchange without any refer- 
ence to the long period during which protective duties have been 
maintained, and without any consideration of the great harm that 
may arise from bad methods of abating what may even be an existing 
evil. With such intolerant and illogical persons, who give little or no 
consideration to existing conditions, no discussion is possible. 

The writer was bred in the firm conviction that, for the reasons 
given, the protective system was founded on principle and on facts. 



256 The Industrial Progress of the Nation. 

and that protection was necessary to the welfare of the country. It 
has only been by close observation of the facts of life that he gradually 
became convinced that these arguments for the so-called system of 
protection were not founded on any principle and cannot be justified 
at the present time even on the ground of expediency. The arguments 
should be met, however by a fair and full consideration of the facts 
and the influences which led to the adoption of the policy in the past, 
and of the conditions as they exist at present, changed as they have 
been in some measure by past acts. 

It may be admitted that by force of the highly protective system as 
it now exists in this country, and as it has been in force practically 
since the years 1861 and 1863, certain arts have been more fully 
developed, certain products have been increased, and certain prices 
nciay have been reduced both here and in other countries through the 
effect and in consequence of this system. It may even be admitted that 
in respect to certain very important commodities — notably iron and 
steel,' — the actual prices have been reduced both here and in other 
countries more rapidly, and possibly to a lower point, than they would 
have been, except the protective system had been in force in this 
country. It must be admitted that as a consequence of the high duties 
upon wool, the price of domestic wool has been reduced by force of 
protection to a lower point than it would have attained except under 
this system ; and that wool growers have been misled in their expecta- 
tion even of temporary benefit to themselves. There may be other 
articles which have been affected in the same way. 

All that can be said in rejoinder to this possible admission of the 
claims made on behalf of protection is, that any reduction of prices 
which has been, or may be brought about in this way is not worth what 
it costs ; and that during the longer or shorter period given to the 
operation of this method of securing a reduction in the actual price of 
an important material, such a disparity or difference iji p7'ice has been 
maintained throughout this period of high protection in the cost of the 
crude materials — such as wool, iron, steel, and chemicals, — which are 
most necessary in the processes of our domestic industry, as compared 
to the cost of these same materials to the consumers of other countries, 
as to have made the cost of the protective system much greater than 
the benefit, if any benefit there has been to any one. 

In other words, whatever may be the advantage or the disadvantage 
of a reduction in price, if it has been brought about by or through the 
interference of legislation, the disadvantage of being subjected to 
higher prices in this country as compared to prices elsewhere through 
a- long period, on the most important crude materials which are abso- 
lutely necessary in all branches of domestic industry, has been and is 
much greater than any possible benefit arising from lower absolute 
prices of such materials at a later period. 



What Shall be Taxed ? What Shall be Exempt ? 257 

In the competition of nations, it is the relative price that tells and 
gives supremacy at a given time, whatever the actual price may be. 

For instance, iron and steel are the most necessary metals ; they lie 
at the foundation of all production and distribution ; their consumption 
is the most adequate standard by which to measure the progress of any 
nation ; but their production is one of the most undesirable occupa- 
tions, which fortunately requires but a small fraction of the population 
to be devoted to it. 

In 1880 less than one hundred thousand men and boys produced 
about four million tons of pig-iron in the United States. At the 
present time, such have been the improvements in the method and 
the reduction in the necessary work, that it may be computed that 
not over one hundred and fifty thousand to one hundred and seventy- 
five thousand, out of twenty to twenty-one million persons now occupied 
for gain, are required to serve our present population with over seven 
million tons of iron. 

Reference has already been made in a foot-note to one of the pre- 
ceding articles, to the fact that while we have consumed during the last 
ten years very nearly thirty per cent, of the entire product of the iron 
and steel of the world, and during the last two years nearly forty per 
cetit., yet although the actual prices of these metals have during this 
very period been greatly reduced, our consumers have paid fifty-six 
million dollars a year on the average more than their competitors, or 
five hundred and sixty million dollars in all in ten years (1878-1887), 
for iron and steel, according to compilations which are given by 
Mr. David A. Wells in his forthcoming work. Such has been the 
cost of protection. For the last two or three years we have paid 
more than seventy million dollars a year over and above the price 
paid for these crude materials by consumers in Great Britain in this 
single branch of industry. Hence it follows that if it should be 
claimed and allowed that this is the right way to establish and main- 
tain the production of crude iron and steel in this country, it must also 
be admitted that it has been accomplished at a cost measured by this 
disparity in price, of five hundred and sixty million dollars in ten 
years — which is more than all the capital now invested in all the iron- 
mines, blast-furnaces, steel-works, and rolling-mills combined which 
are now in existence in this country. Had it not been for this dis- 
parity in price working constantly to the disadvantage of this country, 
no matter what the actual price of iron and steel may have been in 
any one year, can it be doubted that our consumption of iron and steel 
in the manufacture of ships, rails, machinery, locomotives, and tools 
and wares of every description would have been vastly greater than it 
has been ? Is it not true that we have failed to retain even the control 
of our own markets in respect to manufactures and machinery made 



258 The Industrial Progress of the Nation. 

of iron and steel, while we have been almost wholly forbidden any 
share in the supply of other countries? Have we not protected the 
consumers of iron and steel, — or the manufacturers who use crude 
iron and steel in other countries, — to the disadvantage of our own,, 
and must not this disparity in price be charged to the cost of develop- 
ing our domestic iron-mines, works, and rolling-mills by way of 
special taxes on imports imposed for the purpose of protecting them ? 

If there has been something added to the occupation of the people 
underground and in these furnaces and rolling-mills, has there not 
been even more taken away from the occupations of the people upon 
the farm, in the factories, the workshops, and the ship-yards of the 
country, whose products might have been exchanged for these crude 
materials ? Lest these figures should be questioned, I will give the 
proofs and cite the authority. See special treatment of this subject 
subsequently given. 

Have we not protected the woolen manufacturers of other coun- 
tries rather than our own, by forcing the huge supply of wools from 
Australia, from South America, and from other parts of the world 
upon them in exchange for their fabrics, thus lowering prices to them 
by withholding our own free competition, while depriving our own 
consumers of these varieties of wool without which our manufacturers- 
of woolen and worsted fabrics cannot thrive ? Have not these duties 
on crude materials prevented us from holding even the home market 
in this country for our manufactured goods, although the people con- 
sume more fabrics made of iron, wool, and cotton than the people of 
any other country ? 

At this very moment (May, 1889) it is alleged that through the 
consolidation of several steel-works in the West the making of tin 
plate may be taken up ; and a desperate effort has been made to 
double the tax of about six million dollars that' the people of this country 
now pay on tin plate imported, in order to sustain domestic industry 
in making these plates. Hardly an article could be named upon which 
a tax could be placed with more injurious effect than upon tin plates. 
They are articles of common necessity in the dairy, in the work of 
canning meats, fish, vegetables, and fruits, and they enter into all the 
domestic arts of life. To the extent to which they may be taxed the 
farmers of this country are placed at a disadvantage in saving their 
crops or products by canning them. In answer to the question, 
" What are the most notable consequences that would follow the 
establishment of this industry in America ? " the answer has lately 
been given by the promoters of this enterprise, that if this industry 
were established here, " we should keep among our own inhabitants- 
from twenty to twenty-five million dollars a year, a constantly increas- 
ing amount, which we now send abroad the moment we can supply 



What Shall be Taxed? What Shall be Exempt? 259 

our own demand." This statement is one of the glittering generalities 
which may deceive even the elect ; it is alleged that we should keep 
among our own inhabitants a certain number of dollars ; but this is 
not the fact ; we do not buy our tin plates with dollars made 
of either gold or silver ; and if we did, it would be because we can 
produce more gold and silver dollars than we need for our exchanges. 
We buy our tin plates with the pounds sterling which are placed at the 
credit of the exporters of our corn, wheat, flour, cheese, cotton, oil, 
and other products which we cannot consume at home and which are 
exported. We pay for tin plates with the excess of our food, fibres, 
and oils. These products go to supply the people of other countries 
with the necessary articles of food and fibres which we produce at 
high wages and yet at lower cost than any other country. If we cut 
off the imports of twenty-five million dollars' worth of tin plates we 
also cut off the export of twenty-five million dollars' worth of wheat, 
corn, cotton, cheese, and other farm products. If the production of 
tin plate would give employment to as large a number of consumers 
within our own limits as now buy this excess of our product which is 
exported, our farmers might not feel the difference. But would such 
be the fact ? The production of tin plate is very largely a matter of 
capital, and in moderate extent and in small numbers a matter of rather 
low-grade labor, while that labor is of such a kind that there are none 
capable and few willing to do the kind of work which is necessary to 
be done in order to produce tin plates here. The production of tin 
plates here would imply the application of a large amount of capital, 
and the importation of a moderate number of laborers skilled m 
the art, who must yet be a somewhat low-priced quality of work- 
men, as no part of the work is a very desirable one to follow. 
Hence it might follow that the farmers who now supply food and 
fibres in exchange for foreign tin plates would lose a part of their 
large market abroad, and would fail to gain in the domestic consump- 
tion of their produce in any equal measure. Should we then save 
twenty to twenty-five million dollars now said to be sent abroad for 
tin plates, or should we not lose at least one half that sum in our 
restricted market for our surplus crops while paying additional taxes, — 
if the present tax on tin plates were doubled in order to promote their 
production in this country ? Would not our farmers not only lose a 
great market while gaining a little one, but would they not also be yet 
more heavily taxed on all that they now produce by the heavier cost of 
utensils in the household, the dairy, the canning factory, and wherever 
tin is consumed ? 

It was not, however, wholly by considerations of this kind that the 
writer was led to change his views upon the subject of protection, and 
to become an advocate of ultimate free trade, /. e., an advocate of the 



26o The Industrial Pi^ogress of the Nation. 

careful adjustment of duties upon foreign imports, to the end that the 
largest required revenue should be derived from foreign imports, with 
the least interference with the freely chosen pursuits of the people. 
Such a policy is a very different thing from the abolition of the custom- 
houses, sometimes imputed to the advocates of free trade. Custom- 
houses are held by them to be necessary instrumentalities for col- 
lecting a revenue by revenue duties upon some commodities, and a 
tariff system must be continued unless recourse is had to a system of 
absolute direct taxation for the support of the national as well as the 
State and municipal governments — a proposition which has as yet very 
little support. 

Having begun to doubt the validity of the premises on which the 
protective system had been established, the writer was induced to study 
the facts relating to the industrial history and progress of this country. 
It at once appeared to him that the system of protection had been ad- 
vocated and sustained almost wholly for the development or support of 
a very few specific branches of domestic industry ; constituting, even 
from the beginning, only a small part of the occupations commonly 
listed and considered under the title of manufactures ; notably, in sup- 
port of iron-mines, iron-works and steel-works, and in support of tex- 
tile manufactures, — all other branches of industry in behalf of which 
the system is sustained being relatively very insignificant, both in the 
annual value of their products and in the number of persons occupied 
in them. 

By reference to every treatise upon the industrial history of this 
country, it soon became apparent to him that the original production 
of iron and steel and their conversion into higher forms owed nothing 
to the tariff. Iron-mines, iron-works, and even steel-works had been 
thoroughly established long before the nation itself had any existence, 
so that one of the very causes of the War of the Revolution had been 
the effort of Great Britain to prevent the development of these arts in 
the colonies of North America. (See " The History of Iron and its 
Manufacture," Census of 1880, Report by James M. Swank.) It also 
became apparent that the manufacture of woolen fabrics, in a true 
sense, was as old as the settlement of the country itself, and that this 
textile art had been fully established and developed before the nation 
itself existed, our ancestors having been mostly clad in homespun fab- 
rics of domestic manufacture in the strictest sense. Woolen manufac- 
tures had been very fully developed, even on the factory method, before 
the first really protective tariff, that of 1824, had been enacted. The 
art of spinning cotton had not been developed early in our history, be- 
cause the cotton-gin itself, on which it depended, was only invented in 
1793 ; but the beginning of the profitable manufacture of cotton in this 
country antedated the first really protective tariff, that of 1824, by 



What Shall be Taxed? What Shall be Exempt? 261 

many years. Aside from these considerable branches of industry, no 
important branch of industry has been introduced into this country 
since the tariff of 1824, which had not a beginning before any tariff was 
enacted ; such branches as have subsequently originated here have 
been promoted or rendered possible by subsequent inventions. 

The writer therefore became convinced that the protective system 
since 1824 had tended rather to restrict than to diversify the occupa- 
tions of the people, and that its only effect, whether beneficial to the 
especially stimulated industries or otherwise, had only been to divert 
labor and capital in some measure from those branches of industry to 
which they would have been applied without a tariff, to those which 
have been especially stimulated or promoted by means of a tariff. It 
also became apparent to him, as it was apparent to Daniel Webster 
before he was forced from the position of a statesman to take up the 
functions of an advocate, that the specific branches of industry which 
could be thus stimulated by a tariff were not in themselves very desir- 
able occupations to the people who might engage in them ; probably 
much less conducive to welfare than the arts to which they would have 
been devoted, except for this artifical method of directing their work. 

. No wiser words were ever spoken on this subject than those which 
were uttered by Daniel Webster at a meeting held in Boston in Faneuil 
Hall on the 17th of August, 1820, to resist the efforts which were then 
being made, notably by John C. Calhoun and the representatives of the 
slave States, to establish a system of protection in order to create a 
greater home market for slave-grown cotton. The officers and pro- 
moters of this meeting were all leading merchants of Boston, many of 
whom were forced by the tariff act subsequently passed, to give up 
their commercial pursuits and to engage in manufacturing. The fol- 
lowing is a report of the proceedings copied from the Daily Advertiser, 
and of the resolutions adopted : 

At a meeting of merchants and others interested in the prosjierity of commerce 
and agriculture, at Boston, on the 17th day of August, 1820, to take into consideration 
a communication from the Chamber of Commerce, at Philadelphia, on the tariff recom- 
mended to Congress at the last session, the following persons were chosen a committee 
to adopt such measures in relation to the subject as they should deem expedient. 

Messrs. William Gray, James Perkins, John Dorr, Nathaniel Goddard, Benjamin 
Rich, Israel Thorndike, Esq., William Shimmin, Thomas W. Ward, William Harris, 
Daniel Webster, Nathan Appleton, Abbott Lawrence, Joseph Sewall, Jonathan Phil- 
lips, Lot Wheelwright, Caleb Loring, Samuel A. Welles, George Bond, George Hallet, 
Samuel P. Gardiner, Josiah Knapp, Isaac Winslow, Winslow Lewis, Thomas Wiggles- 
worth, John Cotton, John Parker, William Sturgis. 

The meeting was then adjourned to the 2d day of October, at which time delegates 
from the principal seaports of Massachusetts, and farmers, manufacturers, and all others 
feeling an interest in the subject, were invited to attend. 

The committee appointed seven of their number — Messrs. Perkins, Gardiner, 
Welles, Shimmin, Sturgis, and Dorr — to prepare a report and resolutions, to be sub- 
mitted at the adjourned meeting. 



262 The Industrial Progress of the Nation. 

At the general meeting in Faneuil Hall, on the 2d of October, a report, presented 
by Mr. Perkins, chairman of the committee last mentioned, was accepted, and the 
resolutions accompanying it adopted unanimously ; and it was ordered that they be 
printed, and a copy sent to every member of Congress from the State. 

The following were the resolutions thus adopted in a State which afterwards be- 
came strongly protectionist, but which is now once more about to take the lead in 
demanding freedom of trade. 

Resolved, That we have regarded with pleasure the establishment and success of 
manufacturers among us, and consider their growth — when natural and spontaneous, 
and not the effect of a system of bounties and protection — as an evidence of general 
wealth and prosperity. 

Resolved, That, relying on the ingenuity, enterprise, and skill of our fellow- 
citizens, we believe that all manufactures adapted to our character and circumstances 
will be introduced and extended as soon and as far as will promote the public interest, 
without any further protection than they now receive. 

Resolved, That no objection ought ever to be made to any amount of taxes, equally 
apportioned and imposed, for the purpose of raising revenue necessary for the support 
of government ; but that taxes imposed on the people for the sole benefit of any one 
class of men are equally inconsistent with the principles of our Constitution and with 
sound policy. 

Resolved, That the supposition, that until the proposed tariff or some similar meas- 
ure be adopted, we are and shall be dependent on foreigners for the- means of 
subsistence and defence is, in our opinion, altogether fallacious and fanciful, and 
derogatory to the character of the nation. 

Resolved, That high bounties on such domestic manufactures as are principally 
benefited by that tariff favor great capitalists rather than personal industry or the 
owners of small capitals, and, therefore, that we do not perceive its tendency to 
promote national industry. 

Resolved, That we are equally incapable of discovering its beneficial effects on 
agriculture, since the obvious consequences of its adoption would be, that the farmer 
must give more than he now does for all he buys, and receive less for all he sells. 

Resolved, That the imposition of duties which are enormous, and deemed by a large 
portion of the people to be unequal and unjust, is dangerous, as it encourages the 
practice of smuggling. 

Resolved, That in our opinion the proposed tariff and the principles on which it is 
avowedly founded would, if adopted, have a tendency, however different may be the 
motives of those who recommend them, to diminish the industry, impede the prosperity, 
and corrupt the morals of the people. 

In sustaining these resolutions, Daniel Webster used these words : 

' ' To individuals this policy is as injurious as it is to government. A system of 
artificial government protection leads the people to too much reliance on government. 
If left to their own choice of pursuits they depend on their own skill and their own 
industry. But if government essentially affects their occupations by its systems of 
bounties and preferences, it is natural when in distress that they should call on govern- 
ment for relief." 

Were not these words prophetic ? Has not the tendency ever since 
the adoption of the protective tariff of 1824 been for many great bodies 
of the people to think they could better their condition either by 
attaining higher wages, by shortening the hours of labor, or by some 



What Shall be Taxed? What Shall be Exempt? 263 

other artificial method, through an appeal to the Legislature to pass 
every kind of act for regulating the direction of the labor, the hours of 
the work, the rate of interest, and the methods of life at every point ? 
Has not the long-continued existence of this system given a tendency 
to the hardly disguised socialistic movements of the present day ? 
Daniel Webster continued his speech as follows : 

" Hence a perpetual contest carried on between the different interests of society. 
Agriculture taxed to-day to sustain manufactures — commerce taxed to-morrow to 
sustain agriculture — and then impositions perhaps, on both manufactures and agri- 
culture to support commerce. And when government has exhausted its invention 
in these modes of legislation, it finds the result less favorable than the original and 
natural state and course of things. He could hardly conceive of any thing worse than 
a policy which should place the great interests of this country in hostility to one 
another — a policy which should keep them in constant conflict, and bring them every 
year to fight their battles in the committee-rooms of the House of Represetitatives at 
Washington." 

What truer picture can be given to-day of wliat we have seen than 
this forecast of Daniel Webster's of what we should see ? 

But it was not even by consideration of these matters that the writer 
"became finally convinced that the true interests of this nation would be 
attained, the greatest diversity of occupation promoted, and the widest 
extension of manufactures brought about, by steady and regular legis- 
lation in the direction of ultimate free trade ; his final conclusions were 
reached only by attempting to reason upon JV/ia^ Makes the Rate of 
Wages? (see " Distribution of Products," G. P. Putnam's Sons) ; the 
result of this investigation being the conclusion that in all arts to which 
modern labor-saving inventions or mechanism can be applied by an 
intelligent people, high rates of wages either in money or in what 
money will buy do not imply a high cost of production, but quite the 
reverse, the rule being twofold : 

I St. That in all such arts, high rates of wages, either in fnojtey or in 
what money will buy, are the necessary complement, correlative, or co?tse- 
quence of a low cost of production, provided commerce is free from any 
artificial obstruction. 

2d. A principle developed both by Henry C. Carey, the protection- 
ist, and by Frederic Bastiat, the free-trader, " that in proportion to the 
increase of capital the relative share of the annual product secured by capi- 
tal, while it may increase absolutely is dimitiished relatively ; but, on the 
other hand, the share falling to labor, i. e., to those who do the actual work, 
is increased both absolutely and relatively." 

Since these two principles became apparent to me, I have devoted 
such time as might be spared from the occupations of a busy life, in 
attempting to bring them into common notice, believing that in this way 
«ven those who had faith in the protective system might be led to see 



264 The Industrial Progress of the Nation. 

its error, and might be ready to join with the reasonable but not revo- 
lutionary advocates of free trade in such a revision of the system of 
duties on foreign imports as would promote domestic manufactures to 
the utmost, while depriving the people in least measure of their free- 
dom in applying either their own labor or their own capital to produc- 
tive industry. 

How this should be done and what period of time should be covered 
in making the change, are matters of relatively small consequence, pro- 
vided a definite policy be adopted and that a beginning should be 
made. 

The actual burden of taxation under the present tariff, measured in 
money, even including any small private gain which at the present 
time may be secured in consequence of its existence, is a matter of 
relatively small importance. The writer is of opinion that we can 
afford to continue even under the present system, if that is the only 
way by which the national debt can be speedily paid in full. But even 
that end may be secured, /. ^., the speedy payment of the whole debt, 
and yet great modifications may be made in the existing tariff, and at 
the same time a true adjustment of its terms may be made to the new 
conditions of the country which have been developed since the end of 
the Civil War, if the reasonable men on both sides of this question 
could but for a time lay aside their mutual jealousy and their suspicion 
of each other's motives, and by reasonable methods devise a measure 
which would yield not only the maximum revenue required from cus- 
toms, but the maximum benefit which may be gained by a reduction of 
taxation. This can be readily accomplished without exposing any 
great branch of industry which has been developed or considerably 
extended under the influence of the existing system, to any disaster. 

It is to this end that these studies in the Industrial Progress of the 
Nation have been prepared, as one of the object-lessons which may be 
useful to both parties in the controversy in the discussion of the eco- 
nomic questions which are now pressing upon this country for solution. 

It would be hardly worth while to devote many years or much la- 
bor to these two subjects of production and distribution, if they related 
wholly to material conditions. If there were not a moral and an ethi- 
cal side to the studies of the social facts which are commonly included 
under the somewhat misleading title of Political Economy, these ques- 
tions might be of little interest, even to a student of affairs. It is the 
moral and ethical aspect of the study of material things which places 
social science above the plane of mere materialism, and puts the study 
of social facts at the head of all inductive sciences. 

The first development of manhood, i. e., the elevation of man above 
the beast, appears to have been brought about through the perception 
of man that he could accumulate both the concrete results of labor, but 



I 

I 



What Shall be Taxed? What Shall be Exempt? 265 

also the conclusions derived from experience, to the end that each 
generation might give the next a better start in life, and thereby each 
succeeding generation might be enabled to live a better life than the 
last, provided the general intelligence of the people of each generation 
should be developed coincidently with the accumulation of macerial 
products, so that they might be able to find out the best way of making 
use of the skill and capital derived from the past. 

As one passes in review the events which have occurred in the 
nineteenth century, affecting the material welfare of men and of 
nations, and at the same time attempts to forecast the events of the 
twentieth century, the mind becomes dazed in attempting to com- 
prehend the possibilities of the future. At the beginning of the nine- 
teenth century the previous inventions of Henry Cort in smelting 
iron with mineral coal ; of Watt in the use of steam ; of Arkwright 
and others in the application of iron and steel to the textile arts, 
together with good highways and other great improvements, intro- 
duced between 1750 and 1800, had given to Great Britain a huge 
advantage over all other nations in the accumulation of wealth ; a 
great part of this gain was even then derived from her foreign com- 
merce, although, even up to a later date her commerce was most 
injuriously obstructed by protective duties. By this huge increase in 
her productive power she was enabled to join in the great contest with 
Napoleon, and to subsidize other states and nations in that under- 
taking ; these efforts, culminating in the battle of Waterloo, put the 
dynasties of the Bourbons and others again into power and restored 
the old and bad division of countries, duchies, and petty states, for 
the far better boundaries which Napoleon had established. 

In this struggle was also laid the foundation of the great debts and 
standing armies which are now eating out the heart of Europe ; yet, in 
spite of these debts and armies, by means of the inventions and appli- 
cations of science which have come into effect during the century, 
the people have been sustained, great progress has been made, and 
the foundation has been laid for the better conditions of life whenever 
the mass of the people who are now oppressed shall find out the way 
to abate the privilege of classes, to throw off the burden of debts 
incurred by dynastic rulers to which they never gave their consent, 
and to disband the armies by which the prejudices of race, caste^ 
and creed, are maintained at the heaviest possible cost, now evidently 
becoming insupportable and steadily leading on to nihilism, anarchy, 
socialism, and other evils by which force is met by force. 

Yet perhaps even the later inventions of the present nineteenth cen- 
tury, by which time and distance have been almost eliminated and the 
cost of distributing the abundance of the earth has been reduced to a 
mere fraction, may prove to be as inadequate in the service of men 



266 The Industrial Progress of the Nation. 

compared to what is yet to be accomplished by science, as the 
old methods had proved to be ineffectual as compared to those which 
are now working towards abundance and common welfare. 

Already the crack-brained enthusiasts of the present day may prove 
in the future to have been the true prophets when many new processes 
are perfected, of which the effect can only be imagined : such as the 
•conversion of heat directly into work ; the development of electricity, 
whatever the force so named may be ; the purification of the waste of 
the sewers at little cost with profit to those who do the work and freed 
from the degrading conditions now connected with such occupation ; 
the disassociation of the nitrogen from the atmosphere and its conver- 
sion into food for plants by less costly and quicker methods than any 
yet known, thereby removing any possible pessimistic notion of the 
food supply becoming deficient for the population ; the derivation of 
heat more directly from water and the conversion of its elements 
into power without the intervention of such excessive quantities 
of carbonaceous fuel as are now wasted ; the production of the metal 
aluminium at low cost, giving us a new substance for the construction 
of all kinds of machinery from a metal in which lightness and strength 
are combined and for which the crude material is most abundant. 

Or again, to any one who studies the textile arts critically or theo- 
retically, in which the production of coarse cotton cloth has been 
increased in a single generation from a possible five thousand yards to 
each operative in the factory in a year, to thirty thousand yards as the 
result of fewer hours of labor in the same factory at the present time, 
it is apparent that all existing cotton machinery, perfect as it seems to 
be, is crude and cumbrous. Seventy-five units out of each hundred of 
the original strength of the cotton fibre are destroyed in the rough 
handling which it receives upon the machinery by which it is worked 
or in the processes by which it is rendered suitable for clothing. The 
loom is but a development of a prehistoric type, to which ingenious 
devices have been added, but which is still subject to be invented out 
of existence when some one with the genius of Arkwright applies his 
inventive capacity to a revolutionary change in the method of weaving, 
such as Arkwright applied to the extension of the strand of cotton or 
wool prior to spinning, by means of successive rolls working at dif- 
ferent speeds. 

To what extent and in what way these changes may work the 
welfare of mankind, one may not yet imagine ; suffice it that one may 
now be warranted in laying down a principle the very opposite of that 
upon which Malthus ventured : to wit, the application of science tends 
to develop the means of material welfare for the enjoyment of man- 
kind in something like a geometrical progression, while mankind itself 
tends to increase at a far more moderate rate of progression to which 



What Shall be Taxed? What Shall be Exempt ? 267 

no fitting mathematical term may yet be applied because the law 
governing the increase of population is not yet fully comprehended. 
We may, however, almost if not absolutely determine that the con- 
clusion of the whole matter is, that in respect to material things the 
consumption of mankind is limited, while the power of production 
of the means of subsistence is relatively unlimited. Under these 
conditions peace, order, and industry may be maintained wherever 
the law of mutual service on which all commerce among men and 
nations is founded shall become a part of the common knowledge of 
mankind. 

It is not, however, necessary to wait for such knowledge and com- 
prehension of the true function of commerce to become universal. 
Whenever the English-speaking nations and states shall adopt the 
principle of free exchange so far as it is consistent with the necessity 
of each country or state to derive a revenue from duties placed upon a 
few articles, it may become impossible for any other country which 
continues to subject itself to heavy duties upon imports, to compete in 
any large way in the commerce of the world. Such a protected state 
or nation may be enabled to maintain its isolation more or less effectu- 
ally ; although according to the experience of nations, especially of 
this country, the retention of the home market is rendered more and 
more difficult by the imposition of duties on important materials, un- 
less these duties are put so high as to become prohibitive. Even in 
that case evasion, false swearing, and smuggling tend to prevent the 
complete success of such an undertaking. What more beneficent in- 
fluence could the English-speaking people exert than by their control 
of commerce, which benefiting themselves and all who deal with them, 
may also put an end to the contests among nations and to the oppres- 
sion to which other states and nations are now subjected simply because 
they cannot compete except by adopting the same methods ? 

If, then, the analysis of social facts leads to the conclusion that the 
greatest gain to all nations is to be reached through interdependence 
and not by isolation or independence, and that the development of in- 
dividual character rests upon mutual service and not upon the selfish 
isolation either of men or nations, it follows that the pursuit of material 
prosperity at once becomes justified as a means to a higher end, that 
end being the harmonious relations of mankind and the establishment 
of conditions of order and industry which are conducive to and are 
only consistent with the strictest morality and the highest measure of 
■common intelligence or civilization. 

May it not therefore be held that so long as man dwells in a ma- 
terial body upon the earth, the satisfaction of the material wants of 
that body will be secured by mutual service rather than through mutual 
plunder and strife ? 



268 The Industrial Progress of the Nation. 

May it not, then, be held that man could only come to the concep- 
tion of his higher mental and spiritual faculties through the struggle 
and strife which have been and are still so arduous in the work which 
is necessary for the supply of his material wants ? The body, the mind, 
and the spirit can only be separated by physical death ; in life they 
iTiust be harmoniously developed in order that either phase of life may 
attain its highest conditions, — giving consideration to mankind rather 
than to the individual man in treating the general terms of existence. 
It may be admitted that high spiritual qualities have been developed 
when asceticism was thought to be necessary thereto, but such lives 
were almost wholly wasted, for the reason that the example could not 
be followed by masses and it would have been impossible for mankind 
to continue to exist in that way. High mental qualities have also been 
developed under the great disadvantage of extreme poverty ; in some 
cases it may even have been that the extreme poverty was necessary to 
give the necessary stimulus to the mental development of an excep- 
tional man ; but that constitutes no rule for mankind. The highest 
type of art may have been evolved under the conditions of society in 
ancient Greece ; but would any intelligent person to-day propose to 
restore the order of Grecian society for the purpose of attaining a high 
place in art ? The golden age in English literature may have been in 
the sixteenth or seventeenth centuries ; but would any reasonable 
person suggest that the order of society as it existed in England at 
that period should be restored, even if it were necessary to the attain- 
ment of such a high plane of literary activity and development ? 

It may be and probably is true that the development of the material 
resources of this continent have so occupied the minds of men who 
dwell upon it as to have turned their attention in great measure away 
from art and literature for a time ; but it by no means follows that art 
and literature may not ultimately make even greater progress, even by 
way of this temporary retardation, than they could have attained under 
other conditions. In what country or in what age has there ever been 
more readiness to apply wealth, gained by the busy work of a single 
life and by men who have themselves had little appreciation of art or 
literature, to literary and artistic purposes. In what period and in 
what country has there ever before been such a readiness to devote 
private gains to the purposes of common education of every kind, in- 
dustrial, technical, scientific, literary, and artistic ? 

It may therefore be the result of very shallow observation if the 
great material progress of this nation is condemned for the reason that 
it has not yet been accompanied by the highest artistic and literary 
achievements. It doth not yet appear what we shall be. It is but a 
hundred years since the United States laid the foundation of a national 
life by the adoption of the Constitution, and that life had no true ex- 



What Shall be Taxed? What Shall be Exempt f 269 

istence until Abraham Lincoln became the chosen instrument to give 
liberty to the slave. 

But, on the other hand, it may be held that our material as well as 
our mental progress has been retarded, because legislation has been 
directed to an attempt to help those who could not help themselves, or 
who believed that they could not help themselves, in making use of the 
huge natural resources of this country. In this mistaken effort may 
there not be found one of the causes of the alleged mediocrity of the 
modern statesmen, or of the politicians who cannot be called states- 
men, as well as of the discredit which is to some extent attached to 
political life, or to what might and should be the highest service of the 
state. 

What else could happen if it is admitted that the public trust re- 
posed in legislators may be diverted to any purpose of private gain, 
even though the end avowed might be the public good ? 

It is admitted on every side and by every person whose observations 
are worthy of any consideration whatever, that in the nature of things 
every great nation must, of necessity, sustain itself in chief measure by 
the development of its own resources, i.e., from the product of its own 
fields, its own forests, and its own mines, if any there are within its 
limits. It is admitted on every side that the internal traffic or com- 
merce of a great nation — that is to say, the exchange of its own prod- 
ucts among its own citizens — must, in the nature of things, constitute 
the greater part of its traffic. With respect to this country, it must be 
admitted by every one who examines the question with any earnest 
purpose of ascertaining what the facts really are, that with respect to 
the products of agriculture, the power of production at high wages and 
low cost, as compared to any and all other nations and states, is so 
great that not less than ninety-five per cent, of all our food and fibres 
for our own consumption must be raised within the limits of our own 
country, because no other country can possibly compete with us, and 
that we could almost feed the world besides. Even though the rates 
of wages are from fifty to five hundred per cent, higher than those of 
any other country, the products of agriculture which could be in part 
imported from any other country — consisting almost wholly of sugar, 
tobacco, wool, hemp, flax, and a few other articles of possible import, 
or which could be in part imported, constitute not over five per cent, 
of the entire product of our farms. With respect to the product of our 
mines, no other country could supply us with our necessary consump- 
tion of coal, although a small part of our fuel might be imported from 
Canada, if coal were free from taxation. No other country could sup- 
ply us with any considerable part of our copper in competition with 
our own mines. No other country could possibly supply us with any 
considerable part of our necessary consumption of iron and steel, even 



2 Jo The Industrial Progress of the Nation. 

if all taxes on imports were removed therefrom, without such a rise in 
the price in other countries, followed by a rise in the cost of produc- 
tion, as would forever do away with the existing disparity in the price 
which puts us at so great a disadvantage in the conversion of these 
metals into their higher forms for use. Had our workshops and fac- 
tories which are now in existence been constructed on even terms with 
respect to the cost of materials, as compared to those of other coun- 
tries — that is to say, free from the disparity or difference which has 
been caused by the tax upon the import of the materials which are 
consumed in their construction, no other country could supply us with 
any large part of the common or necessary forms either of the useful 
woolen or cotton fabrics which are required for the comfort of the 
people, however large a part of our supply of the finer fabrics depend- 
ing mainly upon fashion and fancy might be imported, if there were 
no duties upon them. 

Hence it follows that, with respect to the number of persons on 
whose occupation a system of duties on foreign imports may for a time 
exert a favorable or at least a stimulating effect, we must omit all of 
those who are engaged in professional or personal service ; all who are 
occupied in trade and transportation ; ninety to ninety-five per cent, 
of those who are occupied in agricultural pursuits ; and a large pro- 
portion, varying from sixty to eighty per cent., according to the judg- 
ment of the investigator, of all who are engaged in the arts of the 
mechanic, in manufacturing, or in mining. Under these conditions it 
follows, of necessity, that any legislation directed toward the especial 
establishment or development of particular branches of industry must 
proceed, in the first instance at least, by way of taxation upon the many 
for the temporary support of the few in the conduct of work in which 
they are either incapable, or think they are incapable of proceeding 
successfully without such support from the government. Hence it 
follows again that all legislation of this kind is, of necessity, special 
legislation, to be determined upon grounds of expediency and not 
upon any fundamental principle of taxation. 

What else could be expected from such a system persistently fol- 
lowed since the year 1824, upon the quality of legislation and the 
character of those by whom the laws are made ? 

Is it not true that the moment it is admitted that legislation may 
be rightly adopted for the special development of particular branches 
of industry, the danger comes in which had not before existed, that the 
public office of the legislator may be perverted to purposes of private 
gain, even without the legislator being himself conscious of the influ- 
ence by which he is governed ? May it not also follow that even if the 
attempt is successful, and if even higher wages or greater profits accrue 
to the particular branch of industry to which special legislation is 



What Shall be Taxed? What Shall be Exempt ? 271 

directed, the lesson will be caught up and followed in other lines with- 
out discrimination, by unreasoning people who do not perceive that 
such a system of protection must, in the nature of things, be of very 
limited application ? Has this not been the course of legislation for 
the last sixty years ? What truer picture could )iave been drawn than 
that already quoted from Webster : " Agriculture taxed to-day to sus- 
tain mafitifactures — commerce taxed to-morrow to sustain agriculture — 
and then ijnpositions, perhaps, on both manufactures and agriculture to sup- 
port commerce." 

What would the subsidies now proposed to be given to steamship 
lines be but " impositions on manufactures and agriculture " ? 

What need of them when men stand ready to construct the steam- 
ships and to establish the commerce without subsidy or bounty, only 
asking that the obstructive taxes which now forbid shall be removed. 

Must it not also ensue, and has it not ensued from the apparent if 
not real success of this method in developing certain branches of in- 
dustry, and of regulating indirectly the prices of goods and the wages 
of labor, that the unintelligent should impute to legislation greater 
power than it is possible to exert by statutes, and should compel Con- 
gress and legislatures alike, by mere force of numbers, to attempt to 
make the same kind of application of statute legislation to all the func- 
tions of life — to wit, to the hours of labor, the methods of work, and 
even to the direct regulation of prices. May we not attribute much of 
the socialistic tendency of modern legislation in this country to the 
subtle germ implanted under the so-called system of protection ta 
domestic industry. 

It would not be suitable for the writer to make a personal appli- 
cation of these views to particular States or periods in the history of this 
country. The great moral upheaval of society brought about by the 
existence of slavery developed heroic qualities, brought true statesmen 
to the front, and raised the level of the discussion of principles in the 
Senate and the House of Representative to the very highest plane, as 
the discussion of moral and ethical principles always has done and 
always will do. 

But whence came the jurists, the statesmen, the legislators, the 
executive officers, and the soldiers by whom this work was done ? Did 
they not come from States which either had not been subjected to the 
idea of special legislation, so as to have become almost incapable of send- 
ing men of any greatness or force to Congress, or else from States which 
possessed sufficient intelligence among the mass of the people to sur- 
mount the evil effects of long devotion to legislation for special purposes ? 
But since that contest was ended, has not the corruption of the civil 
service become the paramount evil ? Have not the debates in Con- 
gress, with few exceptions, come down to the level of unintelligent 



272 The Industrial Progress of the ATation. 

mediocrity ? Has not the condition of election to political office 
become a matter of private bargain rather than of devotion to the pub- 
lic service ? AVill not the function of the politician be degraded from 
the high place in which it ought to stand as the title of him who serves 
his country in the truest sense, by even an honest and sincere but yet 
injurious perversion of the powers of the legislature to the support of 
special interests which may be demanded by men who as honestly and 
sincerely believe they are entitled to such support ? 

Even if every thing could be attained in the way of material progress 
and prosperity which is claimed for the protective system, would it be 
worth gaining at the cost of depriving the nation of its opportunity 
to develop all its forces and all its opportunities by its own inherent 
capacity and ability, Avithout calling upon the legislature to enact 
special taxes intended to force the direction of industry out of its 
natural channels ? 

Even if the writer had not reached the conviction that the pro- 
tective system had failed in accomplishing its declared purpose, — and 
even if he had not reached the conviction that it had retarded rather 
than promoted the development of agriculture and manufactures by 
obstructing commerce, — he would nevertheless have advocated a return 
to the policy of free trade, so far as it may be consistent with the 
necessity of securing a revenue from imports for the support of a 
national government, on these moral and ethical grounds only. But in 
this as in all other matters affecting human welfare, there is a true har- 
mony in all the phases of life. That policy which can be defended 
wholly on moral and ethical grounds is the policy which will econom- 
ically yield the best results, or, in common speech, will pay the best in the 
long run. Their is neither permanent pay nor permanent profit in any 
material work which cannot be justified morally and ethically as well as 
politically and socially. 

The special occupation of the writer forbids any active participation 
in the immediate contest ; suffice it that in this attempt to measure the 
material progress of the nation by facts and figures he may have cleared 
away some of the misconceptions, especially in regard to what makes 
the rate of wages, so that the virulence of the contest may be lessened, 
to the end that right conclusions may be reached by a reasonable com- 
promise among intelligent men, who on the protective side may claim 
and on the free-trade side may admit, that any system of taxation 
which has been long continued should be carefully and judiciously 
treated in the process of removing these taxes which even on their own 
merits could not have been justified when first imposed. 

When the tariffs of 1861 and 1863 were first adopted, on the basis of 
which all subsequent tariffs, including the act now in force, have been 
modeled, the main purpose was to provide a great revenue for the 



What Shall be Taxed? What Shall be Exempt? 273 

conduct of the war and to adjust tariff and internal taxation on the 
same basis. Under such conditions little attention could be given to 
the science of taxation. Subsequently both the demand of the war itself 
and the tariff have greatly altered the relative conditions and the direc- 
tion of industry from what they would have been had the comparatively 
low tariff of 1857 remained in force. It may be rightly held that those 
who are engaged in such branches of work, which have been so changed, 
should be duly considered and consulted in the progress of amend- 
ment ; but the chief obstruction to rightful change grows out of 
mutual distrust and the imputation of purely selfish motives on both 
sides. 

When men who are accustomed to co-operate in all the other work 
of life apply common-sense to the tariff question, the whole obscurity, 
difficulty, and complexity may be removed. 

Putting entirely aside any ethical or political questions affecting the 
controversy between the respective advocates of protection and of freer 
trade, and taking up the subject in a practical way as it now stands, 
there are probably very few persons competent to pass judgment upon 
the subject, and who are free from personal or political bias, who hav- 
ing investigated the effect of high duties upon wool would not or have 
not come to the conclusion that the respective interests both of the 
wool grower and of the woolen manufacturer would be promoted by 
putting wool into the free list and adjusting the duties on fabrics on 
a lower basis than at present so long as duties may be imposed on 
woolen fabrics. 

In respect to iron and steel it might be admitted, as I have pre- 
viously stated, that the great stimulus given to production in this coun- 
try by way of the duty on foreign imports, had developed this branch 
of work more rapidly than would otherwise have happened ; and it 
might even be true that this policy had reduced the price the world 
over. Yet I think if the sense of antagonism could once be laid aside, 
and if reasonable men could take up this subject exactly as it now lies, 
they could not fail to reach the conclusion that it would be for the 
joint interests of the iron- and coal-miner, the owner of the blast-fur- 
nace and of the rolling-mill, as well as of the consumers of iron, to put 
ores and coal immediately into the free list ; and either to take every 
duty off from pig-iron at once or by successive stages at 20 per cent, 
per year, reducing the duties on the more finished products so as to 
meet the new conditions ; and to this end I submit the following facts 
for what they may be worth. In the previous text I have referred to 
the researches of Mr. David A. Wells and to the figures which he may 
give in a forthcoming work ; he has made use of the actual data given 
in the yearly Abstract of the Iron and Steel Association, and of other 
•equally authentic figures, without venturing upon any estimates ; and 



2 74 ^^^ Industrial Progress of the Nation. 

he has covered the period from 1878 to 1887 inclusive. I have omitted 
187S and 1S79, and computed 1888 and 1889, venturing upon some 
estimates for the present year, 1889. 

On the basis of these authentic data and estimates, the consumption 
of iron and steel in the United vStates, less than a very small export, 
has been as follows : 

NET TONS 2,000 LBS. EACH. 

1880 6,408,754 

I88I 5,964,002 

1882 6,513,493 

1883 5,924,621 

1884 5,323,872 

1885 5,177.764 

1886 7,595,720 

1887 9, 184,447 

Total 52,091,673 

Domestic 41, 934,08? 

Foreign rails, bars, plates, etc 10,157,585 

Total 52,091,673 



In addition to the above imported metal there has been a very large 
importation of machinery, hardware, cutlery, firearms, etc., for which 
there are no data for computing the weight. Adding this element by 
estimate, and this consumption of iron in the United States has proba- 
bly been nearly 30 per cent, of the product of the whole period. 

In 1888 the domestic production was a little over that of 1887 — the 
import somewhat less. In 1889 our production is increasing, and the 
import, especially of machinery, is large ; the total consumption of the 
two years cannot be much less than 18,000,000 tons, or nearly forty per 
cent, of the total product of the world. 

Without adding any thing for imported machinery, hardware, etc., 
the consumption of the United States in ten years ending December 
31, 1889, will have been over 70,000,000 tons of iron : adding by 
estimate the weight of all the machinery, hardware, etc., the total con- 
sumption has been about 72,000,000 tons, about one third to one half 
in the form of steel. 

The present consumption of the United States only, being now, if 
not quite, yet nearly equal to the world's total product of 1865 and 1866. 

The question now arises, How much have the iron and steel con- 
sumed in the United States cost our consumers in excess of the cost of 
the same materials to consumers supplied in and by Great Britain ; it 
being remembered that our consumption is now in excess of the total 
product of Great Britain ? 



What Shall be Taxed f What Shall be Exempt ? 275 

For the purpose of computing this disparity or relative disadvan- 
tage, I take the quotations of the highest annual prices in Great Britain, 
Scotch pig-iron, and average prices of anthracite foundry iron in Phila- 
delphia as quoted per gross ton in the Statistical Abstract of the Iron 
and Steel Association from 1880 to 1887 ; assuming that the difference 
in 1888 and 1889 has been the same as the average of these years : 

Anthracite foundry averaged $22 42 

Scotch pig at 24 cts. to a shilling 12 54 

Difference $9 88 

per gross ton ; equal to $8 82 per net ton. 

Our comsumption has been 70,000,000 net tons, which at $8 82 per 
ton gives the total excess of cost of iron in this country as compared 
to consumers of British iron for ten years, 9617,400,000 ; equal to 
$61,700,000 per annum.' I have tested these averages by computing 
the actual difference of each -year, 1S80 to 1887, on the actual con- 
sumption of each year, and I find the result comes rateably to more than 
the above, the greatest difference in price falling on the years of great- 
est demand and consumption, as one would naturally expect. 

On comparing the relative consumption I find that considerably over 
one third of our iron is converted into steel prior to consumption, and 
also that the difference in price of the higher grades of iron has been 
more than that on foundry iron. This disparity in the price of steel, 
added to that on iron, ranges from $7 to $15 per ton, but calling it 
only $6, on 25,000,000 tons we get $150,000,000 to be added to the 
difference on iron. 

A truer standard of comparison than Scotch pig would be common 
English foundry iron, worth about $1 per ton less than Scotch. Add- 
ing $1 on the quantity represented by our domestic production of about 
58,000,000 tons makes $58,000,000. 

SUMMARY. 

Disparity on Scotch pig and anthracite foundry, 70,000,000 at $8 32 ^617,400,000 

Add on steel not less than 25,000,000 at $6 150,000,000 

Add on 58,000,000 tons domestic to adjust the standard to English iron. . 58,000,000 

Actual total $825,400,000 

Deduct for contingencies, errors, or variations, say 125,400,000 

Computed difference $700,000,000 

These figures prove that the prices of iron and steel, both domestic 
and foreign, have been maintained above those of other countries in a 
sum nearly equal to the duties and freight charges, a somewhat rare 
case. In the matter of wool the price of domestic wool has been dimin- 
ished, and in respect to the useful grades of textile fabrics, domestic 



276 The Industrial Progress of the Nation. 

competition has sufficed to keep the prices much below foreign prices 
with duties added, on all staple fabrics. 

Iron is singular because the demand for consumption is imperative. 
In spite of our having doubled our domestic production, we have been 
forced to import over 20 per cent, of our supply for the last ten years, 
and although cost and price have both been reduced here and else- 
where by the improvements and inventions of recent years, the reduc- 
tion of price in Great Britain has been greater than in this country 
We may pass over the period of war and paper money in making this 
comparison. 

The average prices given in the Statistical Abstract of the Iron and 
Steel Association of the United States are as follows : 

Anthracite foundry iron in Philadelphia, average of each year combined : 

1850 to 1859 gold $26 47 

1878 to 1887 " 21 87 



Reduction 17 and 38-100 per cent % 4 60 

Scotch pig-iron, highest prices of each year combined : 

1850 to 1859 gold $17 05 

1878 to 1887 " 12 91 



Reduction 24 and 36-100 per cent % 4 14 

In proportion to the reduction of price both in this country and 
elsewhere, the difference in price paid by our consumers becomes a 
greater and greater disadvantage. The present difference, about equal 
to the rates of duty and freight, ranges from 75 to 80 per cent, on iron 
and steel, according to kind and quality, while the duties on machinery 
are only 45 per cent., which with packing charges added leaves our 
machinists subject to a differential tax of 20 to 30 per cent., from which 
their British competitors are free. 

The disparity in the present year is somewhat less than the average 
of the whole period ; but computing the total consumption of 1887, 
1888, and 1889 at 28,000,000 net tons, two thirds iron and one third 
steel, the excess of the cost of iron and steel to the consumers of iron 
in this country as compared to the cost to consumers supplied by Great 
Britain, has been $60,000,000 to $70,000,000 each year. The revenue 
to the United States on iron ores and pig-iron comes to less than 
$4,000,000 a year. The cost of this revenue to our consumers is over 
many-fold in respect not to actual cost, but to disparity in price. 

Since 1887 it has become apparent that the increasing demand for 
iron and steel no longer depends upon the activity of railway construc- 
tion in the United States, as it apparently did up to 1886 or 1887 ; 
since the latter date it has fallen off two thirds in two years. It is 
evident that the demand of the world for iron and steel is increasing 
very rapidly ; also that the low prices that have lately prevailed have 



What Shall be Taxed? What Shall be E xempt ? 277 

led to a very great increase of demand, especially in the United States 
for other purposes than railway construction. On the other hand it is 
evident that these low prices must be very profitable to the producers 
of domestic iron, since our present product is double that of 1879. 

This increase of the world's demand on Great Britain is met by a 
diminishing supply of fine ores : — twenty per cent, of her supply of ores 
being imported from Spain, Sweden, and Africa, and by an increasing 
cost of coke owing to the great depth and heat of the Durham mines 
and the narrowness of the veins ; hence it is evident that any sudden 
increase of demand on Great Britain would be followed by a rapid 
advance both in the price and cost of British iron and steel. 

If the price of iron and steel could be equalized in Great Britain 
and the United States by raising the pirice of iron there rather than by 
lowering it here, an enormous advantage would be gained by this 
country, and it is becoming evident that while this change may not be 
far off in any event, it might be hastened or brought about at once by 
immediately removing all duties on ores and coal, and ultimately on 
crude iron and steel in this country. 

It is not easy to forecast the increase of demand on Great Britain 
from other points than the United States, but it is not difficult to fore- 
cast the increase of demand in the United States. Our per capita 
consumption of iron in 1880 and 1881 was about 270 lbs. In 1888 and 
1889 it was about 320 lbs., an increase of 50 lbs. per head. We shall 
add 20,000,000 to our population in the next ten years. There is every 
reason to expect a more rapid increase in the use of iron and steel for 
structural purposes and for machinery, in the future than in the past, 
while the normal construction of railways for short lines and connec- 
tions must soon bring about a much greater demand for railway 
purposes than the present. Again, if the price of iron were equalized 
on the two sides of the Atlantic, there would be an enormous increase 
in our use of iron in building ocean steamers and in constructing 
heavy machinery for export. 

If we assume an increase of 50 lbs. per capita in the next ten years, 
and a population of 85,000,000 in 1890, the consumption of iron in 
that year will be 15,725,000 net tons, or more than double our present 
product at 370 lbs. each. 

The recent address of the President of the Iron and Steel Institute 
of Great Britain gives conclusive proof that the only source of supply 
for the increasing demand of the world for iron must be met on this 
continent, by the complete development of the deposits of the mari- 
time provinces of Canada, and the yet more adequate supplies of the 
middle and southern United States ; in Nova Scotia, Virginia, Ken- 
tucky, Tennessee, the Carolinas, Georgia, and Alabama, where the 
deposits of iron and coal are in close proximity and near the surface, 



278 The Industrial Progress of the Nation. 

supplemented in their conversion into the higher forms by the natural 
gas and oil of western Pennsylvania and Ohio. 

It would seem as if the general conclusion derived from all the facts 
now apparent might be, that we have touched the lowest prices of iron 
for the present, and that since Great Britain and Germany probably 
could not add even two or three million tons to their present produc- 
tion without, such an advance in price and cost as would remove them 
from any future competition with this continent, we may witness a 
general advance in price throughout the world erelong. If then we 
should remove all duties, our present very profitable prices would not 
be reduced, but our consumers would be secured for all time against 
competition in ship-building, machinery and hardware for domestic 
use, and would take a very large share in the supply of the increasing 
demand of other countries. 

When all these facts are made known and their bearing duly 
weighed it may not be hopeless to expect an increasing number of the 
members of the Iron and Steel Association to join in asking the im- 
mediate or substantial restoration of the revenue system of 1857 to 
1861, to wit : ores and coal free of duty ; pig-iron at not over 25 per 
cent., with further remission at the rate of five to ten per cent, per 
annum until pig-iron shall also be free. 

It is possible that one may find my measure of the difference in 
price rather too low, but perhaps it has been considered prudent for 
me to discount about 22 per cent, for contingencies. In this case the 
final issue would be, as before given : 

Apparent disadvantage of the United States in the cost of 

iron and steel, 1S80 to 1889, incl $825,400,000 

Discount for contingencies 125,400,000 

Net disadvantage $700,000 000 

Say $65,000,000 to $80,000,000 per year 1880 to i88g, average $70,000,000 for ten 
years, probably over $80,000,000 in the year 1888. 

Mr. Wells has treated the decade 1878 to 1887 in his forthcoming 
book. His more guarded statements on the decade in which the small 
consumption of 1878 and 1879 take the place of my large estimates for 
1888 and 1889, will, I believe, substantially coincide with my final com- 
putation, after my deduction for contingencies from what the actual 
figures show. 

In view of the necessary effect upon the price of iron in Great 
Britain, which must of necessity have ensued from the obstruction to 
free imports from there, in a country which consurnes over a third of 
the total product of the world, retarding a rise in price there while 
such obstruction has existed, it would seem that, with a growing 
scarcity of fine ores, increasing cost of coke, and an increasing demand 



What Shall be Taxed? What Shall be Exempt? 279 

throughout the world, the effect of an immediate abatement of our 
duties could not fail to cause a great advance in price in Great Britain 
and later in the cost of all foreign iron. This would serve for all time 
for the protection of our pig-iron product in the most effectual man- 
ner and would probably lead erelong to the export of iron from 
Alabama to England ; in such event repeating history and following 
the course of trade in iron of the last century, when our charcoal iron 
was exported from the colonies to Great Britain. Under such con- 
ditions our consumers of crude iron and steel would also be protected 
in the most effectual manner by the removal of the differential tax 
which now oppresses them, thus giving them a chance to compete on 
even or better terms with the consumers of iron and steel in Great 
Britain and Germany. 

The final conclusion may be that the most effectual protection of 
the iron and steel interests of the United States would consist in the 
immediate removal of all duties on ores and coal and the immediate 
reduction of duties on crude iron and steel to 20 or 25 per cent, with 
a view to their entire abatement at an early day ; and finally in the re- 
duction of all duties on the finished products of iron and steel so as to 
adjust them fairly to these new conditions. 

These figures may be subject to exception as to the prices taken for 
comparison — to wit, Scotch pig-iron in Great Britain and anthracite 
foundry iron in this country. 

I have discounted over 15 per cent, for the contingency ; if that 
does not suffice, then the burden of proof must fall on the advocates 
of the existing system to prove that the computed difference in the cost 
of iron to American consumers has been less ; and also that the advan- 
tage of the present system has been greater than the price which we 
have paid for it. 

Until these facts and figures can be determined by agreement the 
discussion of the revenue system will remain unsatisfactory and can 
lead to no judicious settlement of a controversy which may soon 
become very bitter. 

More than twenty years ago the writer was invited to become one 
of a party to make an excursion through Pennsylvania, of which 
many of the members were persons in high office or of great influence ; 
he had not then become as profoundly convinced as he has since be- 
come, that the true policy of this country would be to remove all ob- 
structions to commerce with other nations ; he therefore went through 
Pennsylvania governed by the impression which he had derived from 
the persistent representation of members of the Congress of the United 
States from Pennsylvania almost from the beginning of the nation, that 
unless the coal and iron of the State were worked the people of Penn- 
sylvania would be incapable of self-support ; and also under the impres- 



28o The Industrial Progress of the Nation. 

sion that they were incapable of working their coal and iron mines 
without the special support of the national government through taxation 
on foreign imports ; but, as the party went on, making an occasional stay 
here and there, through the southern counties of Pennsylvania, in which 
then and now the greatest value of agricultural products was to be found 
as compared to any counties in any other part of the country, — to the 
timber sections, and thence by the coal-mines and iron-works, — he 
learned that the people of this State had been blinded in regard to- 
their own resources, and had put forward what was in fact a very in- 
significant branch even of their own industry, as the mainstay of the 
whole community. 

Since then the huge product of petroleum and the development of 
the gas wells have been added to the natural resources of this great 
State ; and yet if the representations of its senators and of the ma 
jority of its members in the House of Representatives are to be ac 
cepted, the State of Pennsylvania is incapable of self-support without 
special legislation in support of the iron industry on the part of the 
national Congress. What could be expected under such conditions ? 
The two men of whom Pennsylvania is most proud, but who were not 
natives of that State, did not hold these views — Benjamin Franklin 
and Albert Gallatin. 

What are the facts? In the year 1880 the State of Pennsylvania 
had a population of 4,282,891, of whom 1,457,067 were earning a living 
for themselves and for the rest, being occupied for gain in all the arts 
of life. If we assign to the blast-furnaces that number of the coal- 
miners and workers in and about coal-mines, corresponding to the pro- 
portion of coal and coke used in blast-furnaces, there were less than 
10,000 coal miners and workers who were dependent upon making pig- 
iron. In the same art there were less than 22,000 men and boys occu- 
pied in all the iron-mines and blast-furnaces of the State, all counted ; 
and there were less than 3,000 in the coke ovens. Thirty-five thousand, 
or three per cent, of those who were occupied for gain in Pennsyl- 
vania were all that depended on pig-ion for getting a living in 1880, 
out of over 1,450,000 occupied in all arts. These people were not the 
ones whom the State would put forward as examples of the type of civ- 
ilization of which Pennsylvania is proud. In one sense they were not 
exemplars of American labor at all ; they were men of all nationalities,, 
a large part of them specially imported to do the kind of work which 
native Americans are not willing and are not obliged to do because of 
the adverse conditions under which it is carried on. The conditions 
of underground life and in face of the fiery furnace do not conduce 
to a very high type of manhood, and very few natives of the United 
States will accept these conditions. They can do better. Now in 
order to give special support to this little petty force, all the workers 



What Shall be Taxed? What Shall be Exempt? 281 

in iron and the converters of iron and steel to their higher forms in the 
State of Pennsylvania and elsewhere have been subjected to a tax which 
has caused the price of their iron and steel to be $7 to $14 a ton higher 
than that paid by their competitors in Great Britain, whatever the ac- 
tual price may have been on the average throughout this period of ten 
years from 1879 to 1888 inclusive. Now it may happen that Pennsyl- 
vania may soon be deprived of a considerable part of the production 
of pig-iron by the competition of Alabama and of other parts of the 
country. Will Pennsylvania then cease to be a great and powerful 
State because perhaps one half of a little petty force who do not to-day 
number more than 50,000, if as many, cannot find this particular kind 
of work to do ? May it not, perhaps, be a blessing in disguise, even in 
Pennsylvania, if a system of special legislation which has for so long 
a period belittled her public men and depraved her politics should be 
done away with ? Will not men then come to the front who are capa- 
ble of directing the huge resources that lie within her territory, without 
haunting the lobby of the Committee of Ways and Means and trying 
to get special assistance in conducting work which is in itself of very 
slight importance even to the mass of the people of Pennsylvania ? 
May not Pennsylvania then become represented in Congress and else- 
where by men whose political capacity in a higher sense may be equal 
to her huge opportunity in material production ? 

The reform of the civil service has become, in the judgment of so 
many voters, the matter of paramount interest in this country as to have 
compelled the leaders of both political parties to defer to their judg- 
ment whether they wish to or not. If attention be given to the reform 
of the civil service in Great Britain, and to the necessary conditions of 
complete reform in this country, it may be found that it becomes 
possible, and has been or will be brought about only in just proportion 
to the determination of the people that public legislation shall not be 
diverted to purposes of private gain. It may be held that so long as 
special privileges can be created by law, corruption in the civil service 
will continue. It may therefore follow that the reform of the civil 
service can only proceed in due relation to the reform of the tariff 
system of the United States. 

It might well be remembered, that aside from any question of 
morals or politics, the system of slavery was a great economic blunder; 
none are more fully convinced of this at the present time than the very 
leaders of the Southern States who fought out the war to the bitter end 
by which slavery destroyed itself. It was assumed by the Southern 
leaders who were conspicuous at the time when the abolition sentiment 
at the North began to work upon the community : 

I St. That the only possible relation in which the black and white 
races could dwell together in the same land, was that of master and 



282 The Industrial Progress of the NcUion. 

slave. But now, as the grandson of one of the foremost of the South- 
ern leaders lately said to me, after having described his success in con- 
ducting large plantations with free negroes, in answer to my question 
" What would your grandfather have said to your statement ? " — " If 
my grandfather had known as much about the negro as I know there would 
have been no slavery a7id no war." 

2d. Another stupendous mistake, economically speaking, which 
pervaded both South and North, and which led to the subserviency 
of the so-called cotton whigs in their dealings with the Southern 
States ; especially when the Fugitive Slave Act was passed and Daniel 
Webster attempted to surrender the liberty of the people to the intol- 
erant demands of slavery, was that the cultivation of cotton especially, 
and also rice and sugar, depended absolutely upon slave labor ; and that 
without the production of cotton, rice, and sugar the Southern States 
would be incapable of gaining their own subsistence. This terrible 
blunder in regard to cotton misled even the most intelligent Southern 
men, as the error in regard to iron has misled the people of Pennsyl- 
vania. It will not require a civil war to correct the error in regard to 
iron, as it did to correct the blunders in regard to cotton. A due re- 
gard to the reform of the civil service only, and to the removal of the 
present causes of corruption in the civil service, may suffice to open 
the way for Pennsylvania to enjoy the fruits of the progress which may 
be made within her lines, whenever the domination of her iron-masters 
is overcome. Such progress may perhaps correspond in somewhat 
similar measure to the progress which is now being made in the New 
South since the domination of the slave-masters has been removed 
from that section of our common country. 

The question now recurs, " What imports should be taxed and what 
should be free ? " If the points presented in this treatise have been 
well taken, it is of course impossible to grant just and equal protection 
to all branches of industry and all occupations by means of any system 
of duties, in view of the fact that there could be no foreign import 
which would in any way compete with a product of like kind in this 
country to any considerable extent, in respect to ninety per cent, of all 
our domestic products. On the other hand, there are unquestionably 
more persons engaged or occupied in raising crops, or in the manufac- 
turing and mechanic arts, whose market is wholly foreign and who de- 
pend absolutely upon exports, than there are in all the arts in which 
even a part of the product could be imported. 

Again, it is admitted by both parties in this discussion, that suitable 
discrimination should be used when providing for the taxation of im- 
ports, in order to adjust the taxes so as to promote domestic industry 
to the utmost, so far as domestic industry can be affected one way or 
the other by taxation. 



What Shall be Taxed? What Shall be Exempt 283 

To that end it may be held that it is distinctly unfit to tax 
common articles of food which are of necessary use. Sugar may be 
classed either as an article of necessary use or article of voluntary 
consumption, therefore it stands apart. Under the pressure of absolute 
necessity for a large revenue sugar may rightly be taxed, and there 
are a few articles from which a large revenue can be obtained with less 
interference with the freely chosen pursuits of the people than by a tax 
on sugar. If, however, there is no necessity to secure a revenue for 
sugar, and sugar were made free of duty, while at the same time all the 
duties were taken off of tin plates, there would doubtless be an enor- 
mous growth in domestic industry in the preparation of condensed 
milk and of canned fruits for export to other countries. Therefore, 
whenever there is no longer any necessity for a tax on sugar, it should 
distinctly be put in the free list, both for the relief of the consumer 
and in order to promote domestic industry. 

It may also be admitted that if all other duties were removed from 
articles in a crude condition which are necessary in the various pro- 
cesses of domestic industry, then domestic industry will be promoted 
by exempting raw or crude materials from taxation in tenfold the 
measure that any single branch of industry in the production of crude 
materials can be promoted by subjecting them to taxation 

Again, there are many classes of articles which are finished products 
in their way, which are not ready for final consumption, but are abso- 
lutely required in the further processes of domestic industry. Taxes 
imposed under a tariff upon such articles tend to restrict far more than 
they do to promote the extension of manufactures and the mechanic 
arts. Reference being made to the careful classification of all imports 
by the Treasury Department, printed annually by the Bureau of Statis- 
tics in the Annual Report on " Imported Merchandise Entering into 
Consumption," it will appear that the whole revenue derived during 
the last ten years from Class A, articles of food and live animals. 
Class B, articles in a crude condition which are necessary in the 
various processes of domestic industry, and Class C, articles wholly 
or partly manufactured, which are used as materials in the manu- 
facturing and mechanic arts, has averaged less than the annual excess 
of revenue which it is now so important to keep out of the treasury 
rather than to put into the treasury. 

The revenue of the government from customs may now be reduced 
at least one hundred million dollars, without depriving the government 
of an ample income sufficient to cover all the necessary expenses of 
government economically administered, including even the heavy ex- 
penditure for pensions. 

It may therefore be held that with the exception of a few of these 
articles on which it will be necessary to continue the duties in order 



284 The Indiistrial Progress of the Nation. 

that we may be able to collect the excise taxes on articles of like kind of 
domestic production, all duties in these three classes now yielding 
about one hundred million dollars a year may be wholly abated. This 
answers the question, " What articles should be exempt from taxes ?" 

In reply to the first part of the question, " What imports should 
then be taxed," the answer may be that Class D, manufactured articles 
ready for consumption, and Class E, articles of voluntary use or of 
luxury, may then be taxed under a new system of duties, adjusted to 
the new conditions, at lower rates than those which are now imposed, 
without interfering with any existing branch of manufacturing to its 
detriment, and yet yielding as large or a larger revenue than the gov- 
ernment will continue to require from duties upon imports (see subse- 
quent tables). 

If the existing tariff had been carefully framed, so as to be uniform 
and consistent in its various provisions, a change or reduction could 
be made by percentage, varying the percentage to be taken off each 
year, according to the class to which the import might belong. But 
since the existing tariff is not consistent, but is badly framed and sub- 
ject to grave objection from every standpoint, whether that of the high 
protectionist, the absolute free-trader, or the moderate men who stand 
between these two extremes, the first step in tariff reform ought to be 
a complete revision and adjustment of the tariff in all its parts, having 
reference mainly to bringing all its provisions into suitable relations 
each to the other at present rates, whatever the final policy in regard 
to the reduction of rates might be. It would then matter, little how 
much time should be given to the final abatement of duties or to their 
reduction to a revenue basis, provided a definite policy were adopted 
and a moder^e beginning were made. 

If the method of common-sense be applied even to the existing 
tariff bill, due discrimination being used so as to promote domestic in- 
dustry to the utmost by removing petty obstructions and doing away 
with taxes on the crudest of crude materials and on the most necessary 
articles of food, coupled with the abatement of such petty taxes as do 
not yield revenue enough to pay for the cost of collection, fifty to sixty 
per cent, of the specific subjects of taxation under the present tariff in 
point of number could be put into the free list without reducing the 
revenue now yielded by the existing tariff more than fifteen per cent. 

Let it be for once assumed that the method of common-sense has 
been applied in this way by common consent, there would remain a 
comparatively short list of dutiable articles. We will next assume that 
the rates of duty on such dutiable articles had been adjusted so that 
they were consistent each with the other, and so that the average rate 
on dutiable imports should be the same as it is now. 

The matter of importance would then be to decide upon a distinct 



What Shall be Taxed? What Shall be Exempt? 285 

line of policy in making a suitable reduction upon these rates, and in 
this matter due consideration should be given to the present con- 
ditions of the arts which would be affected, so that sufficient time 
should be taken to enable them to adapt themselves to the new con- 
ditions without danger of any great disaster or loss. 

Assuming that sugar had been treated separately with a view to 
revenue only, the duties which would then remain in force would con- 
sist of those imposed upon a part of the articles in Class C, articles 
partly manufactured for use in the further processes of domestic in- 
dustry ; upon Class D, manufactured goods ready for consumption, 
and Class E, articles of voluntary use or luxury. 

Now it happens that the life of almost any kind of modern ma- 
chinery is limited to a short term of years, after which the machine or 
process must be displaced, either because it is so worn that no further 
repairs will make it fit to be used any longer, or because some new in- 
vention has rendered it out of date. For the sake of the example one 
may say that the apparatus which is made use of for converting crude 
materials into partly finished forms, which constitute the materials 
required in the further processes of industry, may have a life of ten to 
fifteen years, and that the machinery which is made use of in the con- 
version of crude or partly manufactured materials into goods and wares 
ready for consumption may have a life of fifteen to twenty years. 

It may then be assumed that it may be necessary or expedient to 
continue the duties on articles of luxury or voluntary use with ref- 
erence only to the amount of revenue which can be derived from them. 

Next, that it may be expedient to continue moderate duties on fin- 
ished manufactures for a longer period than even the life of existing 
machinery ; but that it would not be expedient to continue any duties 
or taxes which are not required for revenue on crude or partly manu- 
factured materials which are necessary in our own domestic industry. 

If this were the declared and adopted policy, to be adhered to 
without any departure from this line of policy, and without permitting 
any alteration to be made in public legislation at the instance of those 
who sought their private interest in the matter, the simple method of 
doing away with the surplus revenue, and by the same act promoting 
domestic manufactures to the utmost, might be after removing all duties 
except on sugar reserved for special treatment, on classes A and B, to 
reduce the duties on Class D, that is, upon articles partly manufactured 
which are required in the further processes of domestic industry, at the 
rate of ten per cent, per year for ten years ; by the same act reducing 
the duties on Class E, covering manufactured goods ready for con- 
sumption, at the rate of five per cent, a year for such term of years 
as should bring them to the point agreed upon, at which the duties 
might be retained for the purpose of collecting revenue. 



286 



The Industrial Progress of the Nation. 



In order that this matter may be more fully comprehended, the 
classification of irnports which has been adopted in the treasury, to- 
gether with the respective amount of import and the revenue there- 
from, is now given : 

Average of the Imports and Revenues Classified (Disregarding Fractions). 
For Nine Years, 1880 to 1888, inclusive. 

Annual Annual 

Import Value. Revenue. 

Class A. Articles of food and live animals — 

Sugar and molasses $83,000,000 $50,000,000 

All other articles 39,000,000 11, 000,00a 

Class B. Articles in a crude condition which enter 
into the processes of domestic industry — 

Coal, iron-ore, copper-ore, pig-iron, flax, 

hemp, jute, wood, wool, etc 52,000,000 16,000,0001 

Class C. Articles wholly or partly manufactured 
needed for use in domestic manufactures and 
mechanic arts 66,000,000 20,000,000 

$240,000,000 $97,000,000 

Classes D and E. Manufactured goods ready for 
consumption and articles of voluntary use or 
luxuries $210,000,000 $101,000,000 

$450,000,000 $198,000,000 

Average for nine years. — Present import and revenue six to eight per cent, above 
this average. Excess of revenue at the present date. May, 1889, about $100,000,000 
per year ; increasing. 

, Project for Tariff Reform. 

Average Revenue 

about as below 

for 9 Years. 

A. Sugar duties, wholly retained, reduced, or wholly abated, according 

to the assumed need of revenue $50,000,000 

Duties on live animals and .on all other articles of food wholly re- 
moved 11,000,000 

B. Crude or raw materials, wholly removed at once, or on some arti- 

cles, at the rate of 20 per cent, a year for five years 16,000,000 

C. Partly manufactured materials, removed at the rate of 10 per cent. 

a year for ten years 20,ooo,ooO' 

D. Manufactured goods reduced at the rate of 5 per cent, a year to \ 

a revenue basis > ioi,ooo,ooO' 

E. Articles of voluntary use or luxuries, retained at present rates. . ' 

$198,000,000 

The fault of this measure would probably be that the prosperity of 
the country and the wide extension of its commerce would tend to such 
an increase of consumption as to bring in a larger revenue with each 
reduction in the rates of duty. In such event such revenue duties on 
sugar as had been retained might be wholly removed. 



What Shall be Taxed? What Shall be Exempt? 287 

In view of the admitted fact that the existing tariff act, which is 
mainly the work of the so-called Tariff Commission appointed to revise 
the forms as well as the substance of the law, is perhaps the most incon- 
sistent and ill-adjusted measure ever passed, leading to confusion, liti- 
gation, evasion, and inconsistent interpretations at different ports, — the 
first measure of reform already suggested might well be adopted by 
common consent, to wit: the preparation of an act, consistent in all its 
parts, for the assessment of duties at the rates and in the manner in- 
tended by the framers of the existing law without reduction in such 
preliminary act : the choice might then be presented either for radical 
changes and the enactment of a wholly new tariff, or for a gradual 
change based on the newly adjusted tariff by additions to the free list, 
and by reductions by percentage covering a suitable term of years. 

NOTE. 

October 20, 1889. 
The computations on iron and steel in this article were made early in the year 
i88g. On reviewing them I submitted them to Mr. James M. Swank, whose integrity 
as a statistician is so well established, in order that there might be no error in the fig- 
ures on which the analysis is made. This has led me to reduce some of the original 
figures which were higher. On soine points our figures still vary. In the per capita 
consumption of iron I have included by estimate the weight of machinery, hardware, 
etc., of which the value of the import only is officially given. My estimate is a little 
higher than Mr. Swank's. 

Exception may be taken to the selection of Scotch pig-iron in Great Britain, and 
anthracite foundry-iron in Philadelphia as a standard. I am aware of the great varia- 
tions in the quality of iron on both sides of the water, and also in prices according to 
locality as well as quality ; but I have averaged Scotch pig-iron on the highest price in 
each year as compared to the average price of anthracite foundry-iron in Philadelphia. 
Moreover, I have estimated only one third of the iron, or a trifle more, as being 
converted into steel ; Mr. Swank shows that one half the iron is converted into steel. 
The disparity in the price of steel has been greater than that of iron. Had I made a 
full estimate for this item it would have added f66, 000,000 to my figures for ten years. 
Again, the best refined roll bar-iron in Philadelphia may be taken as the equiva- 
lent of the best Staffordshire bar-iron in Great Britain. 

The average price in Philadelphia in 1878 to 1887 inclusive, of the best bar- 
iron, has been $50 31 

The average of the highest price each year of .Staffordshire bars in England 

has been 36 48 

Disparity $13 83 

In attempting to measure the disparity in price to which the consumers of this 
country have been subjected as compared to those supplied from British works, I have 
therefore attempted to keep so far within the facts that no one may gainsay the conclu- 
sion. On these facts our relative disadvantage from 1880 to 1889 inclusive would 
seem to have been over $800,000,000 ; but in 1889 the disparity is diminishing. Lest 
this result should be questioned, I have therefore deducted for contingencies due to 
what some one has called the " total depravity of figures," fifteen per cent. But now 
again, lest this final result should be questioned, we may take off twenty-five per cent, 
more, or $200,000,000, thus reducing the disparity for ten years to an average of 
$50,000,000 a year, or $500,000,000 in all. At this measure the disparity in ten 
years amounts to a sum exceeding the probable value of all the iron mines, blast- 



288 The Industrial Progress of the Nation. 

furnaces, bloomeries, rolling-mills, and steel works of this country which are now in 
working condition ; while the annual disparity in price has been more than the annual 
sum paid directly to workmen in all the iron mines and blast-furnaces in the produc- 
tion of pig-iron. In my own analysis of the direct or absolute labor-cost of iron at the 
mine and at the furnace in 1880, I made it at the official figures ($8) eight dollars per 
ton, including the cost of administration, but not including cost of transportation of 
material. It has doubtless been reduced since that date. 

In a memorandum dated May 7, 1888, Mr. Swank gives the items of direct labor-' 
•cost in a ton of Bessemer pig-iron as follows : 

Ore : Labor in mining and connected therewith, per ton $3 24 

Coke : "in mining coal and coking i 35 

Limestone : " in quarrying 27 

' ' at blast-furnaces i 46 

' ' in maintenance of furnaces 50 

Total $682 

Mr. Swank charges iron with the labor of transporting the materials. I do not. 
In the Southern mines and works it would be very small, and the same labor would be 
expended in moving finished iron when imported or the products of such iron ; it there- 
fore does not form a necessary part of the direct or labor-cost which is requisite to 
securing our supplies of the machinery, etc. , in which iron is consumed. 

The average of Mr. Swank's estimate of the absolute labor-cost and my own would 
be $7 50 per ton. At this rate the actual labor-cost of our product of 58,000,000 tons 
in ten years has been $43,500,000 a year, against a disparity at the-reduced estimate of 
$50,000,000 in the price of our iron to consumers. In 1880 the sum of wages paid 
directly at mines and works on a little less than 4,000,000 tons was $32,000,000, 
including the charge for administration. The number of persons employed was a little 
under 100,000, but the work done corresponded to only about nine months' full time. 
The workmen are about one third skilled or two thirds common laborers ; they doubtless 
average $400 each per year at the present time. This would give 110,000 men and boys 
occupied in this art for the last ten years. The amount of labor in the Southern mills is 
less and recent improvements have doubtless reduced the number of workmen elsewhere. 

The object of this treatise is to give the basis of fact which is necessary to an 
intelligent discussion of what should be taxed and what should be exempt. We may 
reach equality in price with Great Britain, which is rapidly approaching, either under 
the present system or by abating the taxation on the import of iron and steel ; that 
subject is not a part of the present discussion. 

From 1870 to 1879 our consumption of iron was almost exactly 150 lbs. per head. 
At the present low price it has reached 300 lbs., and the uses to which iron and steel 
are being applied are rapidly increasing. If the per capita consumption should go up 
to 400 lbs. , than which nothing is more likely during the next ten years, our population 
which will reach 85,000,000 in 1890, if not sooner, will require 17,000,000 tons, our 
present consumption averaging 9,000,000 tons. Cuba may be added to our sources 
of supply of fine Bessemer ore whenever the duty on iron ore is removed ; the island 
contains enormous deposits easily worked. We are much nearer Cuba than Great Britain. 

It may be held that it is for lack of attention to these bottom facts in the choice of 
^subjects of taxation we are now oppressed by a system of taxation upon imports at 
much higher rates on the materials which enter into the processes of domestic industry 
than are imposed upon the finished products. Such a policy can only result in helping 
foreign manufacturers to beat our own. It is consistent neither with free trade nor 
protection. 



f 



PRODUCTION, DISTRIBUTION, 
CONSUMPTION 



PRODUCTION, DISTRIBUTION, CONSUMPTION. 

THE object and end of all productive labor or effort — mental, 
mechanical, and manual — is consumption ; that is to say, all 
efforts are directed to the conversion ot the primary products 
of the soil, the forest, the mine, and the sea into forms for consump- 
tion, of which the sole purpose is to sustain, clothe, and shelter the 
human body for the time being. A part of such consumption is so 
directed that while it furnishes the means of living to those who do 
the work, it at the same time converts a part of the annual product into 
a permanent or durable form constituting wealth or capital. 

Practically nothing is or can be saved or added to the stock of 
wealth in its primary or crude form. 

The inequalities among men consist — 

I St. In the inequality of consumption. 

2d. In the inequality of possession. 

The prime object of the possession of land or of other property is 
to give positive assurance of the means of abundant consumption to 
him who controls either land or capital. 

The struggle of those who are not endowed with property or in the 
possession of wealth in any considerable measure, is to secure an abun- 
dant supply of the means of consumption from each year's product. 

There is much greater equality in consumption than there is in 
possession. 

In respect to food, substantial equality of consumption as to quan- 
tity must be attained in order that the man may live and not die. A 
certain definite supply of the so-called "nutrients," protein or nitro- 
genous material, starch and fat, is necessary to the maintenance of 
health and strength, and if there is any difference in the quantity of 
food consumed, the working classes, using that term in the narrow sense 
in which working people apply it to themselves (which is the meaning 
subsequently given to the term throughout this essay), consume more 
food by weight than the richer classes, because the kind of work which 
they do enables them to and also requires them to digest more. 

The consumption of clothing is more nearly equal than the provi- 
sion for housing or dwelling. The greatest inequalities are to be found 
in the provision for shelter or the dwelling-place of the family. The 

291 



2p2 The Ltdustrial Progress of the Natio7i. 

necessity for a certain measure of subsistence and suitable provision 
for clothing and shelter is distinctly admitted by the establishment of 
the alms-house or the poor-house, where those who are incapable of 
providing for themselves are provided for at the cost of society. 

It was a matter of very great difi&culty to the writer to justify the 
great inequality which exists in the distribution of products and in the 
control over the means of subsistence, until the subject was taken up 
on what may be called its metaphysical side ; or, in other words, until 
an approximate estimate had been made by himself as to the relative 
value of muscle and mind, or of labor and capital, in the work of pro- 
duction and distribution. The importance of the mental factor in the 
conduct of the work of life, in which it is the prime motive power, has 
been treated in other essays. The object of the present essay is to try 
to make it plain that there are only three methods of bringing about 
greater equality in the conditions of men or in their control over the 
necessities and comforts of life. 

ist. By increasing the quantity of things produced. 

2d. By devising a method by which those who now control a larger 
share of the annual product, whatever that product may be, than they 
can possibly require for their own use and consumption, may part with 
it in such a way as not to pauperize any one in the process of converting 
it to the general welfare. 

3d. By helping those who do not get enough to enable them to live 
in comfort and welfare, to get more, without being subjected to the in- 
dignity of having it given to them either directly or taken from others 
for their use, by any process of law which shall interfere with per- 
sonal rights, with the free conduct of society, or with free contracts 
among all classes of people. 

As society is now organized, the distribution of products is and can 
be worked only by one of four methods : 

I St. By barter or exchange in kind. 

2d. By purchase and sale. 

3d. By taxation. 

4th. By theft, either within or without the forms of law. 

There are three subjects of distribution by purchase and sale, two 
of which differ but little from each other, the third differing funda- 
mentally. 

I St. That part of the product of previous years which, under the 
name of "property," has been converted into more or less durable 
forms, known as capital, tools, machinery, railways, factories, ware- 
houses, and the like. 

2d. That form of property which is commonly called '' quick capi- 
tal," being the food, fuel, clothing, and other goods and wares which 
are on the way from the producer to the consumer. 



Production, Distribution, Consumption. 293 

The third kind of property which passes by title, and which differs 
fundamentally from either of the other two, is land. 

It is held by many that land should not be made a subject of dis- 
tribution by purchase and sale, but should be held as the common 
property of the state, subject to personal possession for use only on 
the payment of a single tax upon its rental value. That branch of the 
subject has been treated by the writer in another essay, under the title 
of " The Single Tax System." The purpose of the present treatise is 
to consider the distribution of the present annual product under exist- 
ing methods and customs, which have been evolved and established 
consistently with the present order of society and present laws. 

In the present order of society relatively few come into the posses- 
sion of so much land or capital as to be classed among the rich. Very 
many possess small parcels of land and small amounts of capital which 
entitles them to be considered " well-off." Aside from these two rela- 
tively less numerous classes, the great mass of the people of necessity 
spend nearly the whole share of the annual product which falls to 
them, in providing themselves and their families with shelter, food, and 
clothing, saving but little and therefore adding but little to the capital 
of the country. 

In other treatises the writer has attempted to prove that in any 
given year of average production not less than ninety per cent, of the 
entire product of any average series of four seasons is and must be 
consumed in a corresponding period of twelve months ; that measure 
of consumption, estimated by me at ninety per cent., or whatever it may 
be, is the cost of subsisting the whole mass of the people, rich and 
poor alike, in that specific year. 

If it can be proved that ninety per cent, is the cost of living, it fol- 
lows that not over ten per cent, of the average product of an average 
year is or can be consumed in such a way as to be added to the capital 
of the country by either rich or poor or both combined, so that it shall 
form a part of the permanent investment to be used for reproductive 
purposes. Of course a small part of the product of one year must be 
carried over to the next, to start the work of that year upon, and the 
corresponding part of the product of that year is carried foward to the 
next. 

It is plain that in this country, at least, an abundant production of 
all the articles which are necessary for subsistence, for comfort, and 
even for a large measure for luxury, is now assured. The only ques- 
tion requiring a better solution is the distribution of this abundant 
product. 

According to my estimate, although not exceeding ten per cent, of 
the a\'erage product of this country is or can be added to its capital, it 
does not follow that not exceeding ten per cent, falls in the first instance 



2 94 ^^^'i-^^ Industrial Progress of the Nation. 

under the control of those who rnay be called the " usHatx c\a»»ts " 
under the name of income. The income of those who own invested 

property, either in capital or in land, — which income falls to them under 
the title of rent, interest, profit, or by way of large salaries for what are 
assumed to be great service*, — ^is doubtless much more than ten per 
cent of the total annual product. But the specific class of persons, the 
rich and the well-off, — to whom this income falls under the name of 
rent, interest, profit, or salary, do not consume it all themselves. Their 
consumption of food is not and cannot be greater in quantity, however 
it differs in quality, from that of any other given number of persons, — 
they have more clothing at one time, but they do not wear out more 
clothing than the working people, — they are much better sheltered, and 
in that matter is to be found the greatest inequality ; but when they 
have consumed all that they care to consume, either for necessary or for 
luxurious or wasteful purposes, — still the greater part of their incomes 
is again distributed by them among those who work for wages or for 
gmall compensation, and it is by way of comp nsation received for the 
service rendered to what may be called the " richer classes," which 
service or work is not in itself productive of the necessaries of life, that 
a large number of those who are included under the title of " working 
classes " get their own living. 

Existing modes of distribution may be good or bad, equitable or 
otherwise ; there may be room for many reforms no\v known to be 
necessary ; but yet there can be no great and revolutionary change in 
the present methods of distribution by taking from the richer classes a 
large share of the income which they now derive from rent, interest, or 
profit, and converting it over to the control and use of those who do 
the actual work of i^roduction, without, for the time being, at least, 
depriving another large number of working people of their j^resent 
mode of gaining their living. 

If those who now ex|)end their rents, interest, or profit in building 
the better class of houses, in the purchase of musical instruments, in 
silverware, in the purchase of the more expensive kinds of furniture, 
in cultivating gardens, in buying and using carriages, and in many 
other ways which constitute either the comforts or the luxuries of those 
who are well off, were deprived of a large part of their income, then 
all who now supply these comforts or luxuries would be without work 
until a new demand had been created for similar services among the 
working classes engaged in the actual work of j>^oducing the necessa- 
ries of life ; but the mere privation of the rich would not endow the 
workman with the means of payment for such services. 

It is very important to keep the fact clearly in mind that the abso- 
lute necessaries of life now require but a moderate portion of the work 
of society to be applied to them, — such has been the gain from labor- 



Production, Distribution, Consumption. 295 

saving inventions ; if increasing wants were not developed with the 
increasing means of enjoyment, work would be wanting for those 
who now provide for such increasing wants. 

In order to make this plainer, I have endeavored to put these facts 
into a graphical form, only making use of figures or estimates in money 
pro forma. On the diagram herewith will be found a series of oblong 
squares, designated respectively: First, Second, Third, Fourth, and Final 
Stage. These are divided into sections representing the conversion or 
distribution of products. For the purpose of this essay it may be as- 
sumed that my computation of the gross value of the annual product 
of 1880, which I estimated at two hundred dollars per capita, or ten 
thousand million for the year 1880, is correct. Let it then be assumed 
that square No. i headed first stage is typical of this amount. This 
gross product is to be put on the way to consumption. It is to be dis- 
tributed under existing methods in the form — 

I St. Of consumption without purchase or sale, as on farms. 

2d. Consumption by way of taxation, national, State, and municipal. 

3d. Consumption by way of wages, small salaries, or the work of 
small farmers who gain little beyond a necessary subsistence. 

4th. Consumption by way of rent, pjrofit, interest, or large salaries. 

5th. Consumption by way of conversion into new capital. 

How is this distribution now made ? 

According to my computation, a proportion equal to ten per cent., 
designated Section No. r., is consumed on farms or elsewhere without 
passing into the commercial product. The taxes of 1880 came to 
about seven hundred million dollars, or seven per cent, of the com- 
puted annual product designated Section No. 2. Taxes are all sub- 
stantially applied to the purchase of the necessaries of life for imme- 
diate consumption, by government officers, from the higher officers 
of the national gpvemment to the workmen upon the town highways 
or the scavengers who sweep the streets, A certain proportion, com- 
puted by myself as being by far the larger proportion of the remainder, 
is carried forward one stage in the form of wages, small salaries, or 
small farmers' earnings designated Section No. 3a, to be consumed. 
The lesser portion of the remainder is carried forward under the name 
of ** rent, profit, interest, and large salaries," Section No. 4^. 

In the Second Stage, Sections i and 2 of the previous diagram are 
left blank, so much of the product having been exhausted by con- 
sumption. The greater part of that brought forward, designated Sec- 
tion No. 3, is spent for immediate consumption by the wage-earners 
and small farmers. A very small part, represented by Section No. bb, 
is saved by working people, and is carried forward to be consumed 
in its conversion into capital. The smaller part of Section No. 4^1, 
previously assigned to rent, interest, profit, and large salary, designated 



296 



The Industrial Progress of the Nation. 



FIRST STAGE. 



jI 


3« 


4& 


2- 



1. Consumption on Farms. 

2. Consumption by Taxation. 

3«. Carried forward as Wages or 
Earnings. 

\b. Carried forward as Rent, Inter- 
est, and Profit. 



SECOND STAGE. 



3. Consumed by Wage-earners. 

4«. Carried forward as Wages or 

Earnings. 
5. Consumed by the Capitalists. 
6i5 and (sbb. Carried forward for 

conversion into capital. 



THIRD STAGE. 



4. Consumed \>y Wage-earners. 
6c. Carried forward for conversion 
into capital. 



FOURTH STAGE. 



h ^ 



6b 6bb 6c. Consumed by Wage- 
earners in the Process of Con- 
version into Capital. 



FINAL STAGE. 



6. Proportion of all products con- 
verted into capita) as measured 
in the preceding sections. 



Production, Distribution, Consumption. 297 

Section No. 5, is consumed by the richer classes who receive it : they 
are relatively few in number, and if they consume or waste according 
to their own pleasure, as much as five hundred million dollars a year, 
or five per cent, of the total computed product, yet their absolute con- 
sumption is represented by the small section numbered 5. Another 
part of what the richer classes receive is carried forward for consump- 
tion by conversion into capital, Section No. dbb ; but the greater part 
of their incomes, designated Section 4^;, is spent on what might be 
considered a reasonable standard of living : — in the construction of good 
houses, for the higher education of their children, in provision for music 
and art, in country-places and the like ; a class of expenditures to 
which no exception can be taken, unless it could be proved that this 
specific class did not add to the aggregate product of the whole people, 
far more than they receive in the form of income or spend upon the luxuries 
or upon tJie comforts of life. 

In the Third Stage, Section No. 4, that part of the income of the 
richer classes, spent by them on houses, gardens, musical instruments, 
carriages, etc., is designated ; it is consumed by the working classes, to 
whom it is paid out, and it provides them with the means of living. 

In the Fourth Stage, that part of the annual product which had been 
previously brought forward under Section No. Q)b, as the savings of the 
working classes engaged in direct production, Section dbb that part 
added to capital by the richer classes and Section dc, that part saved by 
those who work in the service of the richer classes, is represented in 
the process of consumption by the working people who construct the 
railroads, build the mills, or in other ways convert that part of the an- 
nual product which can be added to the capital of the country into its 
durable form. 

In the Final Stage, Section 6, the portion designated separately in 
preceding sections computed at ten per cent, is pictured as being con- 
sumed by conversion into capital of a more or less permanent kind, 
and in the process of conversion is spent among working people. 

Now any one who can make a closer estimate of the value of the 
annual product itself may do so ; or any one who can make a closer 
but different estimate of the way in which the product is divided, may 
alter the size or the proportion of the several sections of these dia- 
grams ; but in so doing they may only alter the actual division of a 
certain annual product without altering the rule under which it is now 
divided, whatever that product may amount to. 

The working people who do the actual primary work of producing 
the necessaries, comforts, and luxuries of life designated in Sections 
2^a and 3, whatever proportion of the product they control or consume, 
and whatever section of the square they occupy, either in appearance 
or in fact, now produce more than food enough, — more than fuel 



298 The Industrial Progress of the Nation. 

enough, — more than fibre enough, — more than clothing enough, — and 
more than timber and metal enough, — to feed, clothe, and house the 
whole existing population in greater comfort than the whole population 
now enjoys on the average. This section of the population, whatever 
its relative number or proportion may be, produces even such an excess 
of the necessaries of life, that with the excess we buy the comforts of 
life from other nations ; such as tea, coffee, sugar, and spice, more than 
enough for abundant consumption by the whole population. Yet want 
exists in the midst of abundance. A few obtain control of more than 
enough and waste a part ; a greater number secure a competence ; but 
the many secure less than enough to enable them to enjoy much 
leisure ; while a few again actually suffer from want or are upon the 
edge of want all the time. 

The problem of society is to change these conditions by evolution 
rather than by revolution ; since even the waste of the few or of the 
many cannot be saved or spent in a different direction without bringing 
about temporary want in the process. For instance, there is scarcely 
a doubt that the small aggregate expenditure of the rich for fine wines 
and fine tobacco, which constitutes but a small part of the aggregate 
expenditure upon this class of luxuries, coupled with the very great 
aggregate expenditure of those who constitute the working classes, for 
beer, whiskey, and tobacco, amounts to about one thousand million 
dollars a year in all ; that is to say, in the aggregate, beer, whiskey, 
wine, and tobacco come to ten per cent, of the entire production and 
of the consumption of the people of the United States ; possibly a little 
less, but according to some estimates even more. 

Let it be supposed or admitted that the world would be better off 
if everybody would give up the use of liquor and tobacco, and did so. 
It would of necessity follow that about ten per cent, of the people of 
the United States would be deprived of their present mode of getting a 
living, and that number would be more than six million, of whom two 
million are at work. This but indicates the stupendous difficulty of 
changing the present methods of society and the yet greater difficulty 
in altering them by legislation. 

After all that may be said and done, there may, however, be those 
who will question the right of persons who fall within the category of 
the richer classes to their present share of the annual product, what- 
ever it may be, and who may claim that this share would fall, under a 
more just method of distribution, in a great measure to those who sort 
themselves as the " working classes." 

In answer to this claim, while admitting that there is room for many 
reforms, — admitting also that there are many defects in existing laws 
affecting distribution which should be amended, — yet the capitalist 
class can be fully justified in attaining and controlling the expenditure 



Production, Distribution, Consufnptioii. 299 

of its share of the annual product, whatever it may be, because they 
add much more thari their own incomes to the total product. 

The mind of man is the prime factor in all material production, — 
without it the mere labor of the hand would be incapable of providing 
for an increasing population. Setting aside all distinction of classes 
and reasoning only on the qualities of mind which are necessary to the 
accumulation of capital, it becomes apparent 

ist. That the saving of capital at the beginning, however little it 
may be, is due to prudence, self-denial, economy, and sagacity. 

2d. The productive use of capital, after it has been saved, calls for 
intelligence, skill, and mental capacity. 

3d. The larger the capital the greater the mental capacity required 
for its application to productive purposes. 

4th. Unless capital is directed to productive purposes, whether in- 
vested in land, mills, railroads, or works of any kind, it yields neither 
rent, interest, profit, or earnings. When productive it increases pro- 
duction more than it secures as income. 

5th. Unless labor did in fact secure a better subsistence in the 
service of capital, the workmen would refuse to work for the 
capitalists. 

It follows of necessity that whatever share of the annual product 
may be secured by the capitalist class under just laws which create 
neither privilege nor preference, the annual product itself in which all 
share, both laborers and capitalists, is increased in vastly greater 
measure by them than that part of the product or share which falls 
to capital comes to. 

A rule has been propounded on this matter by Henry C. Carey, the 
advocate of the highest protection, and also by Frederic Bastiat, the 
most radical advocate of free trade, which is sustained by many other 
writers, and which is also fully proved by the observation of the facts 
of life, to wit : " in proportion to the increase of capital, the absolute sJiare 
Jailing to the capitalist is augmented w/iile tiie relative share is diminished." 
On the other hand, tJie s/iare falling to labor is increased both absolutely 
and relatively. 

There is one method of analysis which may perhaps be accepted as 
conclusive, upon the question of the proportion or percentage of the 
annual product which may be saved and added to the capital of the 
country. 

The population of the United States in 1780 was not far from four 
million ; in 1880 it was substantially fifty million ; the average for the 
century was therefore twenty-six million. Now twenty-six million 
people inhabiting a country for one hundred years is equivalent to 
twenty-six hundred million inhabiting a country for one year. If we 
then assume that twenty-six hundred million people had lived and 



300 The Indtistrial Progress of the Nation. 

worked one year under the same average conditions as the twenty-six 
hundred million had lived and worked during the century, and that in 
the one year the average saving or addition to the capital of the country 
had been ten dollars' worth each, then the sum of the capital thus saved 
would come to twenty-six thousand million dollars. 

While it may be true that not much dependence can be placed upon 
the valuation of the capital of the country as given in the Census of 
i8So, yet this much is known to those who, like the writer, took part in 
the compilation of the Census of 1880, that the capital is overestimated 
rather than underestimated in its valuation. 

Now deducting the valuation of land and of public buildings from 
the computation made by the Census Department on the basis of all 
the returns, and that part of the property of the people of the United 
States which, in 1880, could in any sense have been called private 
capital, did not exceed this sum of twenty-six hundred million dollars. 
Now then, ten dollars a year is ten per cent, of one hundred dollars, 
and if ten dollars' worth of product saved had been added to capital, 
the remainder must have been ninety dollars' worth consumed each 
year per capita. Ninety dollars' worth divided by three hundred and 
sixty-five days in a year gives a little less than twenty-five cents' worth 
a day of products, as the average consumption of each person, man, 
woman, or child, who had inhabited the United States during the cen- 
tury. Could the population of the century have subsisted on less ? 

If however the average product for the whole period has been worth 
more than one hundred dollars per capita, then all the capital we have 
now to show for our savings of a century comes to less than ten per 
cent, of the total product of the century. 

Each one must judge for himself how near that sum, twenty-five 
cents, is to what must have been the measure of daily consumption. 
If the consumption was greater than this, then the proportion saved 
and added to capital is so much less. If the people had been sup- 
ported during the century at less than twenty-five cents' worth, includ- 
ing rent or shelter, food, fuel, clothing, and other supplies, then the 
proportion saved may have been greater. On the whole, ten per cent, 
would appear to be as close an estimate as it is in the power of any 
statistician who is capable of reasoning upon the figures, to set aside 
as the amount saved in each year. 

In 1880 the whole amount of property which was assessed for local 
taxes in the United States was as follows : 



Real Estate $13,036,766,925 

Personal Property 3,866,226,618 



Total $16,902,993,543, 



Production, Distribution, Consumption, 301 

It will be observed that the assessors' valuation on real estate in- 
cludes all buildings and improvements upon land of every name and 
nature. So far as there is any information to serve as a guide, the 
assessment may be about evenly divided. 

Assessment on land one half $6,518,383,462 

Assessment on buildings or other improvements 6,518,383,463 

Suppose it be admitted that the land only was valued at seven thou- 
sand million dollars, for the assessment of taxes. 

The sum of all taxes in 1880 was over seven hundred million dol- 
lars, for national, State, and municipal purposes. 

Mr. Henry George and his coadjutors propose to put a single 
tax upon land in order to meet all these expenses. 

In 1880 the rate would have been ten per cent, on the assessed value. 
This subject is only referred to incidentally, it has been treated else- 
where by the writer. 

If the '* site value ,." so-called, of all land should be taxed ten per 
cent., the question may well be asked how any one but a capitalist 
could afford to build upon or to cultivate it. This assessment, was, 
however, much below the true value. 

An estimate of the true value of the property of the United States 
was made by Mr. Henry Gannett, one of the most conscientious and 
capable of the experts, who was employed in compiling the Census of 
1880. H ^ r-i-'cs tlie following data : 

True value of farms $10,197,000,000 

Residence and business real estate, including water power 9,881,000,000 

Mines, oil wells, and quarries, including half of the annual product of 

the same assumed to be in the hands of the producers 781,000,000 

Railroads and equipments 5,536,000,000 

Telegraphs, shipping, and canals 419,000,000 

Household furniture, books, clothing, jewelry, and supplies of food, 

fuel, etc., in the hands of consumers 5,000,000,000 

Live stock on or off farms, farming tools and machinery 2,406,000,000 

Three quarters of the annual product of agriculture and of manufac- 
tures, including imported goods 6,160,000,000 

Miscellaneous, including mechanics' tools 650,000,000 

Specie 612,000,000 

"Churches, schools, asylums, public buildings, and other real estate 

exempt from taxes 2,000,000,000 

Total $43,642,000,000 

When we come to analyze these figures for the purpose of separat- 
ing the value of land from the buildings or improvements which have 
been put or made upon the land ; and also for the purpose of separat- 
ing that part of the wealth of the country which had become common 
wealth, in order to ascertain what the remainder is, — such remainder 
teing the capital which has been saved throughout the period of our 



302 The Industrial Progress of the Nation. 

existence as a nation, — the matter is subject to some uncertainty and 
we must reason by analogy from known facts. 

In the city of Boston, where the valuation for the purpose of 
assessing taxes is very high, the valuation of land comes to three fifths, 
and of the improvements of buildings constructed upon the land, to 
two fifths of the assessment on real estate. In the country districts 
these proportions are apt to be about reversed. 

On this basis from Mr. Gannett's estimates we may set aside one 
half the valuation of farms, one half the valuation of the residence or 
business real estate and water power, and two thirds of the value of 
the mines, oil wells, and quarries, including the product on hand, as 
being so much capital or wealth saved from previous work, — this leaves 
the valuation of land taken by itself including mines, oil wells, and 
quarries, at ten thousand million dollars. We may then readily com- 
pute the capital. 

Valuation of the capital invested upon the land fio,86g, 000,000 

Railroads and their ecjuipments 5,536,000,000 

Telegraphs, shipping, and canals 419,000,000 

Live stock, farm tools, and machinery 2,406,000,000 

Three quarters of the annual product of agriculture and manufactures 

(rather a large estimate in the judgment of the writer) 6,160,000,000 

Specie 612,000,000 

Miscellaneous, including mechanics' tools 650,000,000 

$26,652,000,000 

We then have what may be called the true capital of the country, 
which is all made use of, with the exception of dwelling-houses, for re- 
productive or for distributive purposes. The remainder, the estimate 
of property consists of household furniture, books, clothing, and sup- 
plies of food which are in the way of immediate consumption, five 
thousand million. Even if we add this item to the capital previously 
set apart, the total comes to only thirty-one thousand six hundred and 
fifty-two millions, — then deduct the dwelling-houses and household 
furniture, books and clothing, and the actual productive or reproduc- 
tive capital of the country in 1880 exceeded but little twenty-six thou- 
sand millions ; or substantially the sum of ten per cent, on an annual 
product of only one hundred dollars' worth per capita for a century. 

Of course the product has of late been much greater, and the 
addition to capital at ten per cent, has of late been very large, — much 
larger in the aggregate than ever before. 

If, then, we put the minimum sum against each person of the popu- 
lation on which the i)eople could by any possibility have been fed, 
clothed, and sheltered, we reach figures which, by comparison with the 
largest estimates of the taxable property of the country, exclusive of 



Produclion, DistribtUion, Consumption. 303 

land, tend to prove the utter impossibility of any accumulation of 
capital having been made in excess of two or three years' product. 

For instance, at my own estimate of two hundred dollars per capita, 
which, in my own judgment, is too large rather than too small, the 
amount available for each man, woman, and child of the population in 
1880, a year of more than normal prosperity, did not exceed what 
fifty-five cents a day would buy at the prices at which goods were then 
gold to consumers ; therefore this sum per capita must have covered 
the consumption of the farm, taxation and the compensation for all 
services of all kinds, whether rendered under the title of rent, interest, 
profits, earnings, salaries, or wages. 

Now it is very plain that the mass of commodities of necessary use 
which have been produced has been greater for the last twenty-five 
years than at any previous period. 'Phe figures indicate double the 
quantity as compared to the first half of the century under considera- 
tion. - The prices for the last five or six years of the necessaries of life 
have been substantially what they were in 1850, before the effect of the 
gold discoveries in California had begun. Ten per cent, of this in- 
creased product makes a very great and rapid addition to capital. 

If the whole production of the population which has dwelt in the 
United States from 1780 to 1880 has been only one hundred dollars' 
worth per capita in all, as estimated in the previous computation, then 
the amount of product available to each person during that whole 
period must have been less than what twenty-seven cents a day would 
buy. If the product has been one hundred and fifty dollars' worth 
per capita each year, consumption has been what forty-one cents a day 
would buy. 

According to my computation for 1880 the total product was what 
fifty-five cents a day would buy, and in view of the continued increase 
of product since 1880 and the lessening cost of distribution, it may to- 
day be about what sixty cents a day would buy. 

Since 1880 the taxes have probably diminished in ratio to product 
from seven per cent, to six per cent. Interest, rents, and profits 
have also steadily diminished in ratio to products until capital can 
secure for its services, when lent for industrial purposes, less even 
than in Great Britain ; although the current rates for call money in 
London, — the banking centre of the world, — may be a little less than 
in New York. 

Again, any one who is at all conversant with the conduct of busi- 
ness may readily bear testimony to the fact, as soon as his attention is 
called to it, that there is probably seldom or never one year's stock of 
food held in advance of consumption, even in this country. There is 
never one year's stock of materials for clothing on hand, seldom a stock 
more than enough for the ensuing season, held in advance of consump- 



304 The Industrial Progress of the Nation. 

tion. The amount of capital, great as it must be, which can be applied 
to housing the increase of population, barely suffices to keep them 
under cover. Ev,en houses wear out about as fast as they are built. 
The warehouse, the machine shop, and the factory are a little more 
durable, but the life of the best machinery is very short ; it is used up 
or displaced by new inventions in from ten to twenty years. If a rail- 
road were neglected for a single year there would be little left but the 
road-bed ; and that would be gullied in the course of every stream. 
There is therefore nothing useful that is very old. " Want treads on 
the heels of plenty," with only one, two, or three years to spare in the 
work of converting the forces of nature to the subsistence of man. 

With respect to land, which is said to be limited and which differs 
in some respects from capital in that whatever the quantity may be it 
cannot be increased in area ; it may be admitted that the area cannot 
be increased but the product of land can be increased almost indefi- 
nitely when the mental factor, which is the prime factor in production, 
is applied to its use. No one yet knows or can measure the productive 
capacity of a single acre of land anywhere. 

The possession of land under existing laws by individuals is more 
free to-day from restriction, and it is more easy for any man who desires 
land to possess it than it was when the pilgrims landed on Plymouth 
Rock, or when the first settlers in Florida occupied the country, before 
a single private title had been obtained from the aborigines either by 
conveyance or by conquest. 

The same amount and quality of work which was then required to 
reach, open, clear, and put land under cultivation, such land being free 
from any private title and open to settlement without money charge, if 
now directed to earning wages in any art which develops the intelli- 
gence and capacity of the man who does the work, will enable him to 
save enough for the purchase of land at present prices, outside a few 
central and thickly inhabited points, in greater quantity and under bet- 
ter conditions for use, than the entire work of the man for a lifetime 
would have sufficed to give him without regard to his subsistence fifty 
years since, or than he could have gained from the virgin forest at any 
time during the past century. 

In fact, good land under good cultivation, with good improvements 
upon it, capable of such use that it has sufficed for the subsistence of 
the best and most competent part of the population during the past cen- 
tury, may now be purchased for a sum of money representing far less 
than the money value which has been expended in clearing it and in 
building fences and walls. 

In 1880, all the crops of the country which required cultivation were 
made on less than three hundred thousand square miles out of three 
million square miles constituting the territory of the United States, and 



Production, Distribution, Consumption. 305 

that part under cultivation did not produce on the average more than 
half a fair crop, owing to the negligent and wasteful methods of culti- 
vation due to want* of intelligence in the cultivator, or want of sufficient 
labor in the process. 

Since 1865 more than one hundred thousand miles of new railway 
have been furnished by capital, by means of which each acre of one 
million square miles of territory has been brought within five miles or 
less of a railway, and thereby brought within the reach of him who 
desires to occupy it at the cost of a few days spent on the way, as com- 
pared to months under previous conditions ; and when he reaches the 
land which he has selected, the price at which he can purchase it is 
the measure of less labor than has ever before been required to secure 
such possession. Under these conditions, are not the propositions 
which have been submitted in other essays fully proved ? 

ist. To wit, that under existing institutions and existing laws the 
working classes, in the sense in which they use that word, have been 
securing to their own use and enjoyment an increasing share of an 
increasing product. 

2d. The richer classes controlling and using capital are securing to 
their use, control, and enjoyment a diminishing share of the same 
increasing product. 

3d. The share which each person may secure to his own use and 
enjoyment of this increasing product, depends upon the development 
of his individual character and capacity. 

4th. All laws restricting the free use of time and opportunity, and 
all by-laws limiting the use of time and talent or skill, are inconsis- 
tent with the progress of society and with the progress of the individual 
as well. 

5th. Liberty sustained under just laws, is the condition under 
which the greatest welfare can be attained by him who possesses the 
capacity to grasp the opportunity now offered him. 



SLOW-BURNING CONSTRUCTION 



SLOW-BURNING CONSTRUCTION.' 

THE fearful losses of life and property by fire in the United 
States have lately attracted the attention which is due to 
the causes of such loss and to the means for preventing them. 
Coincident with these investigations a very profound change in the 
conduct of the business of fire insurance companies is in progress. 
Until within a very recent period the management of an insurance 
company issuing policies of indemnity against loss by fire has consisted 
in taking risks as they might happen to be, a more or less careful in- 
spection having been made into the condition of the property before 
issuing a policy, for the purpose of estimating the rate of premium 
to be charged rather than with a view to improving such conditions. 

The notice of the owners or occupants has sometimes been called 
to glaring defects, and a somewhat desultory inspection has been main- 
tained ; not so much with the intention of informing the owner or 
occupant how to protect the property against fire, so as to reduce the 
loss to the lowest terms, as for the purpose of informing the under- 
writers, so that they may not take or maintain too low a rate of 
premium. In fact, there has been until recently a passive indifference 
and sometimes a frankly acknowledged objection on the part of promi- 
nent underwriters to the introduction of the most effective safeguards, 
lest the reduction of premiums that might be demanded should dimin- 
ish the profits of the insurance companies. 

It may be admitted that under this system many fire insurance 
companies have been established and conducted by men of conspicuous 
ability, with great profit to the stockholders and indirectly with great 
benefit to the assured. These companies have done a world-wide 
business, scattering their risks, and by the very breadth of their opera- 
tions and income, they have been enabled to reduce their premiums to 
the very Ipwest terms that the system itself would permit, subject as it 
has been to an excessive expense ; but as the amount of property at 
risk has increased in recent years with very great rapidity, the com- 
panies of a safe kind have been unable to carry the full lines required 
in the concentrated hazards of our great cities. Owners have therefore 
' Reprinted from The Century ISIagazine for February, 18S9. 
309 



3IO The Industrial Progress of the Nation, 

been obliged to seek insurance wherever they could get it, sometimes 
exhausting all the fire insurance companies of the world. At the same 
time an unwholesome competition has grown up among the under- 
writers themselves by which their previously heavy expenses in the 
conduct of their business have been increased, while badly managed or 
small companies have been led to take risks at less than cost, — a 
method ending inevitably in bankruptcy or in withdrawal from 
business. 

In the opinion of competent experts from eighty to ninety per cent, 
of all the stock fire insurance companies organized to transact business 
within the limits of the United States, or empowered thereto, have 
agencies in the State of New York, which renders it incumbent on 
them to make returns to the Commissioner of Insurance of that State 
giving a statement of all their transactions in the United States. There 
could be no better indication of the rapid growth of Avealth in this 
country during the last twenty-five or thirty years than a comparison of 
the sum of the insurance written by these companies. In 1859, before 
the civil war, the sum of the risks taken by companies making these 
returns was a fraction under $1,500,000,000. In the year 1887 the 
amount in round numbers was $12,250,000,000. 

The proportion of loss to the value of the property insured has 
slowly diminished : there has been a little improvement in the con- 
struction of buildings in some of our great cities, though not much 
elsewhere, so that the loss by fire now ranges from $100,000,000 to 
$130,000,000 a year. The cost of sustaining fire insurance companies 
whose function is simply to distribute this loss over a wider field is 
about $65,000,000 a year ; to this must be added the cost of sustaining 
expensive fire departments, which may be computed at a minimum at not 
less than $25,000,000 a year, and it is probably more, to say nothing of 
the additional cost of water supply for fire purposes. The fire tax of 
the United States may therefore be estimated at a minimum of $180,- 
000,000, or at a maximum of over $200,000,000, in a normal year in 
which no great conflagration occurs. 

Within the last five years a great change has taken place in the 
views of the leading men who conduct the business of the fire insur- 
ance companies, and a system is rapidly coming into vogue for the 
frequent inspection of buildings with a view to the prevention of loss 
by protecting them, so far as their generally bad construction will per- 
mit, from the dangers which must occur from fires that are unavoid- 
able, by installing apparatus to check the rapid spread of fires when 
they do occur. Doubtless a very considerable part of the present 
losses may be saved in this way, but the relief is only a palliation ; the 
true remedy will come only when the owner of the insured building 
realizes the simple fact that he himself is chiefly responsible for all the 



Slow-Burning Construction. 311 

losses that happen. It must be brought home to him that the true 
function of an insurance company is to distribute a loss when it occurs. 
True, it may be a part of the function of the officers of an insurance 
company to instruct an owner how to build his building and how to 
guard it after it is built ; but the owner himself, by his own control 
over the construction and the occupation of his building, is the only 
person who can remove the causes of loss by fire. It must be made 
apparent to the owner of property that if he pays a high rate of pre- 
mium for a policy of insurance // is his own fault ; he makes the rate 
high by neglecting his own duty, and when he may afterward under- 
take to procure a contract of indemnity or policy of insurance at less 
than cost, he is an illustration of the old adage, " A fool and his money 
are soon parted." A contract made under such conditions is not worth 
the money paid for it. 

The cause of this enormous fire tax may be attributed mainly to the 
common practice of what has been perhaps well named " the art of 
combustible architecture." 

How can this waste be avoided ? It is useless to suggest the con- 
struction of buildings modelled on those of Europe, especially of those 
upon the Continent ; we have not a general supply of the soft and 
easily worked stone of which most of the buildings in Paris and in 
many other of the foreign cities are constructed — a stone which cuts 
like cheese and which hardens like iron upon exposure to the weather. 
In some of the States west of the Alleghanies there are considerable 
deposits of easily worked stone which hardens on exposure, but in the 
Eastern and the Middle States no such building-stone is found. Neither 
have we that abundance of low-priced manual labor which will enable 
us to construct buildings exclusively of brick and iron, without exceed- 
ing in cost the capital which can be applied to buildings required for 
ordinary purposes. Many labor-saving devices have indeed been 
adopted in the building trades, but on the whole a building of any 
kind is to a large extent the product of the hand rather than of the 
machine ; the stone must be cut, the mortar must be prepared, the 
brick must be laid, the timbers must be adjusted by hand-work, and 
all the costly finish must be put on by hand. Hence, although it is a 
rule that in all the arts to which modern machinery can be applied a 
low cost of production is consistent with or is the correlative of high 
wages or earnings, yet in arts which remain mainly handicrafts the rate 
of wages becomes one of the elements of a high cost of production or 
construction ; therefore the higher cost of building in this country as 
compared with the cost in Europe is in itself a proof of the greater 
relative prosperity of the members of the building trades, even though 
it results in higher rents to all others. Moreover, many of the articles 
which enter into the construction — especially of city warehouses, in 



3 1 2 The Industrial Progress of the Nation. 

which the greatest losses by fire occur — are heavily increased in their 
cost by the present system of duties on foreign imports ; for instance, 
structural iron and steel, window glass of the better quality (especially 
plate glass), cement, and many building stones, to say nothing of the 
tax imposed upon Canadian lumber. We have, however, a greater 
relative abundance of timber than of other suitable building materials, 
and it follows that wood rightly enters into the construction of our 
buildings more than it does in most European countries, even in our 
factories, city warehouses, churches, and the like. Again, in the north- 
ern parts of the United States wood, properly cut and disposed in the 
building in a suitable manner, is almost a necessary part of the con- 
struction because of the climatic conditions ; stone and brick, when 
exposed to the extreme cold of the outer air of winter, draw moisture 
from within the building, which condenses on the inside of the walls 
and is apt to make the buildings very damp : especially churches, 
wherein the furnace may be lighted and the building kept warm for 
only a part of the week. 

The question therefore arises, Can buildings be constructed either 
wholly of timber, or of brick, stone, or iron for the outer walls, com- 
bined with wood for the inside construction, in such a way as to elim- 
inate the greater part of the causes of the fearful fire tax which now 
constitutes a waste equal to an average of at least fifteen per cent, on 
the net savings or possible additions to the capital of the country in a 
fairly prosperous year ? 

To this question an affirmative reply may be given. It is based on 
many years' experience in the construction of textile factories under 
the supervision and guidance of the mutual underwriters by whom these 
factories have been insured on an absolutely mutual principle for a period 
ranging from thirty to fifty years in respect to the principal companies. 

Witness the necessity for the solution of this problem. There are 
even now more cities' than one in which a great conflagration exceed- 
ing that of either Boston or Chicago awaits but the accident of a spark 
and a favorable wind. It is therefore to be hoped that the time may 
not be far off when, by the bankruptcy or the withdrawal of only a 
moderate number of the existing insurance companies whose losses 
and expenses now exceed their income, a few great and powerful fire 
insurance companies may be enabled to impose conditions upon those 
who apply to them for insurance, under which conditions a remedy may 
be found for the existing faults, even if that remedy be not found 
sooner under the system of inspection and prevention now beginning, 
by which the danger of such a great conflagration may be almost if not. 
wholly removed. 

It is not too much to claim that if a sum of money equal to that 
which is annually paid in premiums for policies of insurance on prop- 



Slow-Burning Construction. 315 

erty situated within the so-called " dry-goods district " of New York 
and its immediate vicinity, covering about one hundred acres, were put 
at the disposal of the officers, engineers, and architects who are em- 
ployed by the factory mutual insurance companies of New England, to 
be by them applied to suitable appliances and safeguards for the pro- 
tection of that district, the danger of a great conflagration would be 
wholly removed and the destruction of even a single warehouse and its 
contents would be of the rarest occurrence. 

Strange to say, some of the worst examples of combustible archi- 
tecture are to be found among our prisons, hospitals, asylums, and 
alms-houses ; next, among college buildings, libraries, and school- 
houses ; to these may be added churches, hotels, and theatres. In the 
year 1887, according to the tables compiled by the Chronicle of New 
York, there were burned within the limits of the United States : 

45 hospitals, asylums, almshouses, or jails, being nearly four per month, in many 

cases accompanied by the loss of a large number of lives. 
126 college buildings and libraries, being ten and a half per month. 
146 churches, being two and eight-tenths per week. 

52 theatres and opera houses, being one per week. 
515 hotels, being one and four-tenths per day. 

The bad construction of these buildings is due mainly to habit, to 
fear of innovation, and to distrust of theory. These inherited faults in 
construction may be readily traced to their origin. In order to make 
this matter plain, the evolution of the modern factory will be fully de- 
scribed in this article, illustrated by examples of the several types of 
building which have been from time to time constructed. When the 
textile factory system was first established, water power only was ap- 
plied to the movement of machinery. The larger factories were thus 
customarily placed in narrow valleys or upon very limited areas of 
land, below the falls of rivers and alongside the streams ; it therefore 
became necessary to economize the area of ground covered by the fac- 
tories and to build them many stories in height. When other arts be- 
gan to be conducted upon the factory system, the buildings were apt to 
be in cities or towns where the price of land forbade large areas being 
devoted to the purpose, and, again, buildings of many stories in height 
were constructed. As time Avent on, however, steam took the place of 
water power, while cheap railway service or rapid transit made it pos- 
sible to scatter the factories over a wider area. Factory buildings then 
began to be constructed in the open country, but apparently it did not 
occur either to the owner, the managers, the architects, or the builders 
that the reasons for constructing a building many stories in height did 
not apply to places where land could be had at a very low price ; there- 
fore the customary bad and unsuitable form of construction was 



314 The Industrial Progress of the Nation. 

adopted and is still practised where it is not only useless and unsate 
but less adapted to the purpose to which the building is to be put than 
a one-story or a two-story building would be. Moreover, the whole 
method of cutting timber having been developed with a view to the 
supply of material required in the ordinary unsafe and unsuitable 
method of construction, it was for many years difficult to obtain 
material cut in a proper way for what has been called the slow-burning 
use of timber. Hence it follows that the art of slow-burning construc- 
tion is little known outside the limits of New England, and until very 
lately it was little known even there except to those who had become 
accustomed to the construction of textile factories, paper-mills, and 
other works which are customarily insured by the factory mutual insur- 
ance companies. It is only within a very short time that the methods 
which have been practised for many years in the construction of textile 
factories — which are only the old methods of almost prehistoric time, 
when timbers were shaped by the axe or by hand, before the modern 
saw-mill had rendered the construction of a sham building possible — 
have been taken up by a few architects of capacity and responsibility 
to be applied to warehouses, churches, college buildings, and occa- 
sionally to dwelling-houses. 

A most conspicuous example of the right method of dealing with 
timber and plank in a commercial warehouse may be found in the 
inside work of the huge building lately furnished and occupied by Mr. 
Marshall Field of Chicago, on plans made by the late Mr. H. H. Rich- 
ardson and carried out by his successors, tke motive of the plan hav- 
ing been derived from the customary method of constructing a textile 
factory. 

In what does slow-burning construction consist ? It may be con- 
sidered somewhat amazing that so simple an art should not have been 
common for generations. We will begin at the weakest point in the 
common art of combustible architecture, to wit, with the roof, and de- 
scribe its evolution. It may be admitted that the modern factory roof 
waited for its possibility until right methods of covering a flat roof had 
been invented ; but even with respect to the roofs that are not flat, 
about ninety-five out of every hundred of those which are now build- 
ing are models of every thing that is bad. They convert the attic stories 
into ovens in summer, refrigerators in winter, and fire-traps all the 
time. It seems as if hardly any one, owner, architect, or builder, had 
€ver put to himself the simple question, " What is the purpose of a 
roof?" The plain answer obviously is, "To keep out the rain." 
Many of these " crazy roofs " of irregular form and full of leaky valleys 
fail even in that essential point. May it not be added to this main 
object of keeping out the rain that the subsidiary purpose of a roof is 
also to keep out the heat of the summer sun and to keep in the warmth 




315 



3 1 6 The Industrial Progress of the Nation. 

of the winter fuel ? May it not even be added that a roof may furnish 
a comfortable and convenient place to get a little fresh air by those 
who dwell in crowded cities ; or at least may not a good roof add one 
floor to a building where work which requires the outer air may be 
done comfortably and conveniently ? Are not the roofs of buildings 
in nearly all hot countries made great use of by the inhabitants ? Are 
they not invariably of thick, solid construction, flat enough to be occu- 
pied in hot summer nights ? In what country is there greater need 
for such a place of comfort and fresh air than in our Northern cities 
during the extreme heat of our summers ? In the country or upon the 
factory the flat roof might not be treated for use ; yet aside from use 
it is better in every respect, so far as safety, ventilation, and other ele- 
ments of comfort or utility are considered, than any other form of roof 
which can be put upon any kind of building. Are our architects capa- 
ble of making a flat-roofed building artistic, or pleasing to the taste?' 
It has been done in many instances ; why not in nearly all ? 

In the evolution of the factory all the faults have been discovered 
and remedied which now infest nearly all the warehouses, hospitals, 
dwelling-houses, schoolhouses, college buildings, and other examples. 
of combustible architecture of this country. 

The first form of factory roof resembled the gambrel roof of the 
dwelling-house. In early days it was constructed of solid timbers set 
wide apart, as they should be, covered with good thick boards and 
shingled ; in some cases the shingles were laid over mortar. I have 
an example of shingles which are more than fifty years old yet still in 
good condition, having been preserved by the interposition of the 
mortar between the shingles and the roof boards. 

This method of outside construction might not be objected to in. 
itself ; on the inside, however, the owners were apt to put vertical 
sheathing at a little distance from the eaves and horizontal sheathing 
across the upper timbers of the roof, making a cockloft. These hol- 
low spaces, in which fire may spread out of the reach of water, are 
among the most dangerous elements of bad construction, especially 
when connected with the basement or the cellar by vertical flues in the 
walls or partitions of the building. 

The next form of roof came into vogue when heavy timbers were 
displaced by joist or plank rafters set closer together. It is commonly 
known among factory people as a "barn-roof," consisting of an ordi- 
nary pitched roof m-ade of rafters set eighteen inches or two feet apart 
on centres, covered outside with thin boards and slated, sheathed inside 
vertically at the eaves, and horizontally across the apex. 

The older factory roof and the barn-roof are both shown in the 
accompanying illustration, which delineates an old mill from which a. 
large establishment has beer subsequently developed. 




317 



3 1 8 The Industrial Progress of the Nation. 

This barn-roof is the most abominable, unsafe, and atrocious roof 
' ever devised for the covering of buildings of any kind. The slates 
serve to attract the heat of the sun, which beats in through the inter- 
stices of the open boards and converts the interspaces of the roof into 
ovens for the concentration of heat and for its distribution throughout 
the building, especially when the roof-spaces are connected with hol- 
low walls. The most effectual method of diffusing heat in a factory 
has proved to be to suspend the steam-heating pipes overhead, at some 
distance from the walls — the warm air following the cold air as it 
passes out by bottom ventilation. By analogy it may be assumed that 
the heat concentrated by the slates in the interspaces of a hollow roof 
diffuses itself through the hollow walls of a building of ordinary con- 
struction. Thus the thin-slated roof fails in summer as well as in 
winter. In this kind of roof a fire is completely protected from water ; 
the slates when exposed to outside he.at are readily cracked ; they then 
fall and cut open the firemen's heads ; the interspaces at the eaves also 
make excellent nesting- places for the rats, which carry into them oily 
waste and other combustible substances to be ignited by spontaneous 
combustion in the heat of summer, to the partial or total destruction 
of many a mill. 

The next abomination came with what is called the French roof. 
This, when put upon the top of a factory, is nearly as bad as the barn- 
roof : it restricts the space in the attic within, adds greatly to the cost 
of the building, while in it are commonly repeated nearly all the faults 
of construction of the lDarn-roof. 

The next roof was a little better. -It consisted of a flat roof made 
of ordinary plank rafters set eighteen inches or two feet apart on 
centres, covered on the outside with boards and then with composition 
or metal, and sheathed within upon the under side of the rafters. The 
humidity generated in any room warmer than the external air and in 
the processes of many of the manufacturing arts passes into the inter- 
stices of this roof, where, the moisture is condensed on the under side 
of the thin boards of the outer covering, from which it drops upon the 
sheathing and rots it, while the interspaces add not only to the danger 
of fire, but work the speedy destruction of the whole roof by the rot- 
ting of the rafters, especially near or upon the walls. This roof was 
usually furnished with a hollow wooden cornice, also bad and dangerous. 

It remained for the officers of the Factory Mutual Insurance 
Company to suggest that the same solid floor which is required in the 
construction of the mill might well be adopted in the construction of 
the roof, only changed so as to give a pitch of half an inch to the foot. 
It was also suggested by the underwriters that the wooden covings 
and gutters and the sham hollow cornices, by means of which fire 
was conveyed from building to building in the great Boston conflagra- 




319 



320 



Tlu Industrial Progress of tJu Nation. 



tion, were a dangerous and superfluous element in the construction of 
the roof of the factor)'. In pursuance of these suggestions all the 
former bad forms described gave way to a simple deck constructed of 
three inch-plank grooved and splined, i>laced on timbers set from 
eight to eleven feet apart on centres, sheathed underneath between 
the timbers if the owner desires a fine finish, and covered on the out- 
side with any of the customary- materials : the ends of the timbers 




THE FACTORY ROOF, FIRST DE^^SED BY W, B, WHITING. 

sometimes projecting outside the wall and the deck carried far enough 
over to form a suitable coving, according to the height and character 
of the building ; or else the !ini.sh may consist of a brick cornice, 
without gutters, the drainage being below. 

Again : the old type of textile factory, from which the plans of a 
great many other factories have been derived, was vtxy narrow and 
very high. It had not entered the rninds of the constructors of the 
earlier factories that the spaces of wall between the windows might be 
very narrow and that the windows might be very wide ; nor had it 
apparently occurred to any one that the tops of the wdndows had bet- 
ter be carried up fiu.sh or even with the ceiling of each room in order 
that the light might be better diffused within. Consequently the wall 
of the factory consisted mainly of a great blank of brickwork with 
small holes in it for windows, the mill being seldom more than fifty- 
two feet wide, often less, and many .stories in height. The illustration 
on page 321 shows mills of this type, nine stories high, including 
attics. 

The width of the mill was gradually extended and the size of 
the windows enlarged by degrees ; for many years about sixty-two 
feet was considered the proper width and the windows began to 
occupy a larger part of the Avail space, while the wall itself was 
increased in thickness. 

At last it Avas discovered that if the tops of the windows were 
carried up flush with the ceiling and as much space, or a little more, 
was devoted to windows as to wall, the width of the mill might be 
carried to ninety feet ; then to a little over one hundred feet. 




■iii^^.^'r^^-' 



21 



321 



322 



The Industrial Progress of the Nation. 



Until now in England, where the light is less intense than in this 
country, cotton-rnills have been built five or six stories in height and one 
hundred and twenty-eight feet wide, — that being the width in which 
certain kinds of machinery can be most economically placed and oper- 
ated, — with six feet of window space to four feet of wall, the tops of 
the window panes being absolutely flush with the ceiling between the 
beams, and the window caps placed opposite the floors. Of late, how- 
ever, the mutual underwriters, having discovered the great danger of 
high buildings as compared with those of wide, low construction, began 
to ask their members who were about to build mills to be operated by 




AMOSKEAG MANUFACTURING CO., MANCHESTER, N. H. (CONSTRUCTED BY H. F. STRAW.) 



stearn power in the open country : " Why do you follow this inherited 
and bad type of building ? A mill of two or three stories in height 
can be constructed at less cost per square foot of floor than a mill of 
any greater number of stories ; if you have room enough, even a one- 
story mill properly constructed may be built at as low a cost per square 
foot of floor as the mill of four or five stories, while it will be as warm 
in winter, cooler in summer, and lighter and better ventilated all the 
year round than any other type of mill can possibly be." Since that 
suggestion was made a large number of factories of only one story in 




323 



324 



The Industrial Progress of the Nation. 



height, covered in with three-inch pine roofs, protected outside with 
gravel roofing, tin, or with cotton duck properly prepared, and lighted 
with what are known as monitors, have been constructed in many parts 
of New England, ranging from half an acre to three and a half acres in 
size ; a very common type being a mill of sixty thousand feet on the 
main floor, constructed on a moderate slope so as to give a basement 
under one third of the mill for wet work or for other subsidiary pur- 
poses. Such one-story buildings are best adapted to weaving, and are 
often built in connection with spinning-mills of two or three stories in 
height. 



One Story Mill. 




{ 



I 



f'"' 



I 



DETAIL OV ONE-STORY MILL. — NO. 2. 



In one instance, in a case where the machinery is very heavy and is 
subject to great vibration, a one-story mill of this sort was substituted 
for one of two four-story factories which had been burned ; the owners 
were advised to reconstruct a one-story mill in place of the burned 
mill, but to make it large enough to accommodate all the machinery 
then in the other four-story mill which had not been destroyed. They 
were warned that the new mill would bankrupt the old one on account 
of the greater economy of the work and the better conditions for its 



HI ■ 




325 



326 



The Industrial Progress of the Nation. 



operation. 'J'he prophecy has proved true : sixty-seven men accom- 
plished the work in the new one-story mill on the same machinery 
which required one hundred men in the old four-story mill ; therefore 
that old mill has been taken down in order to make way for the exten- 
sion of the one-story factory, and the old material has been put together 
in a l)etter form. 

What, then, is the slow-burning construction ? It consists simply in 
consolidating the wooden material in frame, floor, and roof in such a 
w.iy that a fire can be held long enough in any room in which it 



Owe. Slov-yMill. 




















lairJir )'» If 



rivq^ 




— ijjjl) ^_— 



DK'I'AII, OF ONK-STOKY MILL. — NO. 3. 

may originate for a fairly comi)etent fire department, public or private, 
to get it under control, or where it may be extinguished or held in 
check by sprinklers. The timbers used may be solid or may be cut in 
two parts to be bolted together. The latter is perhai)s the better way, 
in order that the air may reach the centre of the timber and season it, 
great care also being taken in mill practice not to paint, oil, or varnish 
the outside of any heavy timber for at least three years after it has been 
])lacf(l in the building, lest what is called dry rot should occur from the 
fciincntation of the sap in the green timber. Where an outside finish 




u ^ 



? ''' 



5 3 



u u 

w o 



328 The Industrial Progress of the Nation. 

is required some architects use the timbers in two parts bolted together 
with an air space between, each timber being also bored through the 
centre lengthwise for ventilation. This latter plan is the customary- 
method with posts when wood is used for supports, a crossway hole be- 
ing also bored near the top and bottom, connecting with the centre. 
Upon these heavy timbers — which are commonly placed eight or ten 
feet on centres resting directly on properly adjusted posts without the 
interposition of any girders lengthwise of the building, in lengths or 
spans from eighteen to twenty-two feet — the floors are laid of plank 
not less than three inches thick when the beams are eight feet on the 
centres. If the beams are ten feet or even twelve feet apart on centres, 
ordinary weights will be carried by floors consisting of four-inch or 
five-inch plank ; the timbers themselves may be from fifteen to not 
exceeding twenty-two feet in length from wall to post and from post to 
post, for ordinary factory loads. If provision is required for extra- 
ordinary loads, a special computation should be made to meet the case. 
If a fine finish is desired, sheathing may be placed underneath between 
the timbers, nailed close to the under side of the plank ; if the most 
absolute security against fire is called for, the finishing may consist of 
plastering laid on wire lathing close against the plank. This plastering 
may be carried around the outside of the timber on the line of the 
timbers, provided no skim coat of lime putty is put upon the plas- 
tering, thereby cutting off the air from the timber. The top floor may 
be laid directly upon the plank, or a layer of mortar may be laid 
between the plank and the top floor ; in some cases asbestos paper has 
been interposed. The layer of mortar offers great security in prevent- 
ing the passage of fire downward. The roof which has been described 
corresponds substantially to the floor, to wit : three-inch plank laid 
upon the timbers, one-inch sheathing on the under side if desired, and 
sometimes one-inch boarding on the plank ; then the ordinary outer 
covering of whatever kind may be adopted. If the roof is exposed to 
great humidity within, as in the machine-room of a paper-mill, one inch 
of mortar may be interposed between the roof boards and the plank. 
This latter roof proves to be impervious to cold or heat, and with 
proper means of ventilation gives security against any possible conden- 
sation of moisture from the atmosphere wdthin. 

An alternative plan consists in setting the first line of posts at the 
right distance from the wall to make a passage-way, the floor of the 
alley being laid of two thicknesses of plank crossed — the posts being 
fitted with hackmatack knees. This form of horizontal truss braced to 
wall and post gives great stability to the building. 

If the building is over one stor}' in height the stairways ought to be 
placed either in separate towers outside the building proper, or else in 
the corners of the building surrounded by brick walls, the doorways 



Slow-Burning Construction. 



329 



being protected by adequate fire-doors consisting of wood encased ia 
tin, iron being one of the most treacherous materials customarily made 
use of for the protection of doorways in party walls. In such a factory 
no cornice is required or permitted, and no sheathing within, set off by 
furrings from the wall can be tolerated. No concealed space is allowed 
any\s'here in which a fire can pass from room to room or from cellar to 
attic. Every part of the building must be open, so that water from 
bucket or hose can be thrown anywhere. 




CONSTRUCTIOK OF FACTORY DE"^^SED BY EDWARD ATKINSON, THE PURPOSE BEING 
TO CONSTRUCT THE ALLEYWAYS SO THAT THEY SHALL BECOME HORIZONTAL. 
TRUSSES, TO PREVENT THE VIBRATION OF THE STRUCTURE. 



If these plans and specifications are compared with the ordinary- 
method of combustible architecture, the reason will be apparent why 
textile factories, paper-mills, and other works are better fire risks and 
are insured at less cost than the average so-called stone church, brick 
hospital or asylum, or iron warehouse, although the nature of the work, 
done carries with it almost every cause of fire hazard from ignition, 
friction, or spontaneous combustion, while in many cases the material 
used is almost explosive. 

The method of Sartor Resartus may well be applied to the average 
hospital or asylum. What is it but a sham ? a picture composed of 
brick or stone clothing or screening a whited sepulchre well prepared 
for the cremation of the inmates ? It consists of an outer wall of brick 
or stone inclosing a wooden structure of the most dangerous kind ; it 
is usually but a system of combustible wooden cells each connected 
with the other from cellar to attic by open wooden ways in walls, floors, 
and partitions alike. Had the motive been to house the inmates of 
most hospitals, asylums, and hotels under conditions which should 
assure the greatest possible destruction of life and property from the 



330 



The Industrial Progress of the Nation. 



least possible cause, greater success could not have been secured than 
has been attained in most of these buildings, in many of which the 
danger is enormously increased by the use o£ gasolene vapor for light- 
ing. How soon a remedy may be found for these faults rests with the 
public to decide. The builders of factories in city or in country 
may perhaps derive some useful information from this description of 




DIAGRAM SICOWING TlUi OUTER LINE OF I'OSTS (HORIZONTAL TRUSSES OR ALLEY- 
WAYS) AND OUTER WALLS, SO ADJUSTED THAT THE FLOORS INSIDE THIS LINE 
OF POSTS MAY FALL AWAY FROM THEM WITHOUT STRAINING THE POSTS OR 
THE WALL. IN ANY CUSTOMARY METHOD THESE POSTS SHOULD BE FIRE- 
PROOF. 

slow-burning construction, for the reason that if carried out consist- 
ently and economically it will cost less than the ordinary method 
-of combustible architecture. 

It may be interesting to add that a mill building of from three to 
five stories in height can now be constructed in New England in ac- 
cordance with these plans at a cost above the foundation varying from 
sixty to seventy-five cents per square foot of floor, counting every 
floor, but not counting the basement unless it is a high basement, to 



Slow-Burning Conslruciiou. 



331 



be made use of in the same way that the other floors are used. The 
cost per sfjuare foot of floor will vary somewhat according to the posi- 
tion, and according to the interior finish required with respect to 
sheathing and other matters. A mill two stories in height, /. ^., of two 
floors for use, can be constructed at somewhat less cost, as the walls 
may be lighter in proportion to the area. 




I'OSTS, I'/NTI.KS, ANIJ CAI'S CUSTOMAK II,Y AUOI-'IKU \H .MILL CONS'J K(;CTION. 



Under ordinary conditions a mill of one story in height can be 
constructed at about the same cost per sfjuare foot of floor as the four- 
or five-story mill if the ground is level and the subsoil is such as not 
to require any excessive expenditure in the foundation. A lighter 
framework and less exjjcnsive methods have been adojjted in some 
cases in one-story construction, so that the cost of the building per 
square foot of floor has been considerably less than the sum named — 
even as low as fifty cents per square foot of floor. For many pur- 
poses, such as for shoe factories or other light work, these changes 
and this kind of economy may be admitted, provided a false economy 
is not applied in the construction of the roof. The whole comfort and 



332 



The Industrial Progress of the Nation. 



welfare of the operative in the one-story factory depends upon the 
solid construction of the roof and the monitors, the plank to be three 
inches thick. Ordinary sloping skylights should never be permitted^ 
as they transmit heat ; while the monitor, with its vertical windows^ 
reflects the heat and may be made use of to promote ventilation. In 
all cases the windows in the monitor either should be double or the 




AUTOMATIC FIRE-DOOR.^ 

sash should be glazed with two plates of glass in the same frame, in 
order that the condensation of moisture on the inside of the windows 
may be avoided. Experience proves that these flat-roofed buildings^ 
even when constructed from one to three acres in extent, are not 
more liable to collect snow than are other forms of roof, and they are 

^ Specifications for Automatic Fire-Door. — Door lo be made of dry pine, 
matched boards, |- in. thick : for all door openings smaller than 4 ft. X 6 ft., to be made 
of two thicknesses, crossed as shown at H and I on plan, and for all door openings larger 
than 4 ft. X 6 ft., of three thicknesses crossed, to be thoroughly nailed with clinch nails. 

The finished door to be covered with heavy tin upon the whole surfaces and 
edges, leaving no wood exposed ; tin to be lock-jointed and without solder. The 
edges to be covered by. sheets lapping around on either side, as shown at A on plan, se- 
as to leave no joint on the edge. 

Door to be hung by strong "barn-door hangers," which may be found at any 
hardware store. The rail may be fastened directly the wall, or, if necessary, put 
upon a wooden stringer tinned on the outside. In either case, the rail is to be bolted 
to the wall by bolts passing through the wall. In no case must the rail be fastened 
to a wooden rail which is held by nails or spikes driven into wooden plugs driven into 
drill-holes in the wall. All woodwork to be tinned. 

Door hangers to be fastened to door by carriage-bolts through the door, and not 
by wood screws. 

A wooden jamb-casing " K " to be fastened to the wall by through-bolts, at the 
lower side of door- way, with a wedge recess to receive the door and force it against the 



Slow-Burning Construction. 333 

"very much more easily cleared of the snow when it does collect. The 
English saw-toothed roof, so called, generally placed over their weav- 
ing buildings, has not proved to be desirable in this country north of 
Philadelphia owing to the tendency of the snow to collect in the 
valleys ; it is also more costly than the roof of the one-story building 
' lighted by monitors, as given in the previous. The light in the saw- 
toothed roof being always taken from the north may possess a slight 
advantage, but in the monitor the windows towards the south can be 
clouded so that there will be no objectionable glare within the room. 

The plan has been adopted in many cases of carrying the brick- 
work to the roof between the windows ; more often, though, the brick 
or stonework is carried only to the windowsills, the superstructure 
being wholly of timber and glass. 

In many cases it is desirable that there should be no open space 
under the floor, both with the view to avoid danger and to give stabil- 
ity and freedom from vibration to heavy machinery. To meet these 
conditions special plans are furnished by the factory mutual companies 
for laying plank directly on the ground without danger of decay. 

It is not a pleasant experience for the officers and inspectors of the 
factory mutual insurance companies to pass, day by day, bad examples 
of combustible architecture occupied as shoe factories, clothing fac- 
tories, and the like, or to see other unsafe buildings in which branches 
of industry are conducted which have not yet come under the super- 
vision of skilled inspectors and underwriters, but which in their intrin- 
sic hazard are safer than the textile arts. It is not pleasant to witness 
the mushroom growth of five-story wooden buildings standing often in 
the middle of a field where land is of little value, in which hundreds 
of people may be daily exposed to great danger, and hundreds of 

Tarick jamb, as shown by section of K. All to be thoroughly covered with tin, same 
as door. Jamb-casing to be made of stuff not less than two inches thick. 

A stop, shown at F, to be fastened to floor, placed so as to crowd the bottom 
of door against the brick jamb. 

An automatic door-closer, shown at D, with fusible joint, E, to be placed upon 
each door, when, for convenience of work, the door must be kept open. One end of 
the rod which keeps the door open can be held over a hook, from which it can be removed 
at night, in order to close the door. The rod, made of wood, is cut diagonally across 
the middle, but is held firm by the copper sleeve, F. This sleeve is made in four 
parts, each soldered longitudinally to the other, with solder which melts at l6o°. It 
is expected to yield and to permit the door to close from the heat of a fire at a con- 
siderable distance. 

If the door must be painted, white paint only must be used. The tin reflecting 
the heat, it is best not to paint at all. 

A threshold from \\ in. to 3 in. thick should be placed in door-way to prevent 
flow of water, in case of a small fire, from one room to another. 

This door was first devised by Hon. Byron Weston, for use in his paper-mill. 
The automatic-closing apparatus has since been added. 



334 ^^ Industrial Progress of the Nation. 

thousands or eveii millions of dollars' worth of property are subject to 
a heavy charge for insurance because the buildings have no right to 
exist. These officers and inspectors know from their own experience 
or that of their predecessors, covering fifty years, that more commodi- 
ous, better ventilated, better lighted, more comfortable, and safer 
buildings could be constructed for the same or for less money than 
these examples of combustible architecture usually cost. 

It would not be within the province of this article to describe the 
customary equipment of factories with pumps, pipes, hydrants, auto- 
matic sprinklers, watchman's electric record clocks, fire-escapes, and 
the like ; all these safeguards are fully described in the technical pub- 
lications of the factory mutual insurance companies. The purpose of 
this paper is only to call attention to the relatively low cost of slow- 
burning construction, and to suggest that because the customary 
methods of building are bad it is not therefore necessary to rush to the 
opposite extreme and to spend money in futile attempts at fire-proof 
building for ordinary uses. In fact, there is no such thing as a fire- 
proof building : a building may be constructed wholly of incombusti- 
ble material and may yet be totally destroyed by the combustion of 
"the contents, especially when the iron members of such a building are 
unprotected from the heat of a fire among the contents. Granite is 
one of the most worthless materials for withstanding heat. In a re- 
cent fire in one of the factories insured under the supervision of the 
writer a granite post 12X12 inches was reduced to sand by the same 
fire that burned into a wooden post next to the granite less than one 
inch. Sandstone and marble are not quite so bad ; unprotected iron 
is most treacherous and unsafe, especially cast iron ; brick, having 
already passed the ordeal of fire, is substantially indestructible, and 
when combined in a suitable manner with heavy timber and plank, 
the latter being protected by wire lathing or by other methods for re- 
tarding the action of heat, serves the best for the safest construction. 

In recent years the profession of the architect has been raised 
above that of a mere artist or draughtsman, capable only of making an 
attractive elevation and of planning a building with little regard to the 
safe or suitable disposition of the material, to the level of some of the 
architects of old time, who, like Brunelleschi, combined with the func- 
tions of the artist the skill of the craftsman, the builder, and the en- 
gineer. The progress of combustible architecture is therefore likely 
to be checked as the young men who are now graduating from the 
Massachusetts Institute of Technology and from other architectural 
schools supply the places of those who, having had no technical 
knowledge themselves, have been unable to prevent the owners and 
contractors from committing the follies in construction by which our 
cities are now rendered so dangerous. 



Slow- Burning Construction. 335 

Objection has at times been taken by some architects to the com- 
ments of the mutual underwriters upon the architects' customary- 
methods, that the factory building planned and constructed under 
their supervision is but a shell or skeleton of the building which the 
architect is commonly called upon to plan and supervise. This may 
be admitted ; yet there have been, and are, architects who have proved 
themselves competent to clothe this skeleton and to adapt it to more 
aesthetic purposes than the factory, by covering the timbers in such 
a way as to make the method of construction even safer and more 
slow-burning than when the timbers are left clear, without losing 
sight of the prime motive — safety of property and of life. The great 
warehouse built by Richardson and his successors for Marshall Field 
is but a glorified cotton factory, and the lovely little building connected 
with the home office of Mr. Richardson in which his art treasures 
were safely housed was but the picker building of a cotton factory with 
a touch of genius added. 

Moreover, the architects themselves are now finding it expedient to 
adopt the same method of subdivision in their work which has become 
necessary not only in many of the practical arts but even in the legal 
profession, viz., either to employ special experts in the different de- 
partments, or else to organize firms in which one should be the artist, 
another the builder, another the engineer. Modern requirements 
make specialization necessary, and there are few indeed who can qual- 
ify themselves for all the requirements of almost any profession. 

In view of the attention which is now being given to the applica- 
tion of the " factory floor " (as it is called) and the " factory roof " to 
other buildings, it may be that the time is not far distant when it will 
be safe and prudent for the owner who intends to construct a textile 
factory to employ a professional architect without incurring the danger 
that the purpose to which the building is to be put will be lost sight of 
in the attempt to apply meretricious or misplaced art to a building in 
which economy and utility must not be disregarded. 



THE MISSING SCIENCE 



23 



THE MISSING SCIENCE.' 

COCTOR NON DOCTOR. 

[In public addresses and in private demonstrations Mr. Edward Atkinson of Bos- 
ton has shown the remarkable results of his investigations on cookery. He has now 
made such arrangements that others can profit by them. The " Aladdin " cook-box, or 
portable stove, which can be carried anywhere and used anywhere, is now ready 
for sale. 

Mr. Atkinson permits us to print some passages from a paper which he read to 
the Boston Thursday Club, one of the oldest and most distinguished of the Boston 
clubs. The reader will see at once that the new invention takes rank among the foremost 
improvements which affect the health, comfort, and larger life of our time. — Editor.} 

THE struggle to support the material life of men and women is 
directed : 

First : To putting a few bits of board, supported by brick, 
timber, or stone, over our heads for shelter. 

Second : In this, the best-clothed country in the world, to con- 
verting on an average each year sixteen pounds of cotton and ten 
pounds of wool per capita into cloth, carpets, blankets, and other 
textile fabrics. [An average family of five persons consumes annually 
eighty pounds of cotton, worth $8.00, and fifty pounds of wool, worth, 
in the grease, $10.00 per year.] The average of raw cotton and wool 
per capita being about $r.8o. 

Third : To securing our food and preparing it, the proportion 
varying in some measure with the section of the country and the 
climate. 

The provision for shelter and the adequacy of the shelter varies 
more than any other element in life in ratio to the income of the 
family. Working people do not have as many clothes at one time, 
but they wear out more clothing than the well-to-do. There is a closer 
approach to communism or equality in the food supply than in any 
other element of life ; food differs in quality more than in quantity, 
but the working-man can eat more and digest more than the man of 
leisure. An average workingman at moderate work must have one 
quarter of a pound of nitrogeneous food or protein, one-eighth of a 

' Reprinted from Lend-a-hand. 
339 



340 The Industrial Progress of the Nation. 

pound of fat, and one and a quarter pounds of starch every day, com- 
bined with water, making three and a half to four pounds a day. 
Those who do the hardest work require more fat and protein and less 
starch. 

Physiologists differ a little as to the relative chemical proportion 
of the nutrients which are considered necessary for subsistence, yet 
when their formulae are reduced to calories, or mechanical equivalents 
of heat, the dietaries established by Voit, Playfair, and others become 
almost identical. The application of the system of calories, or the 
mechanical equivalents of heat, to the food question, has been invented 
and adopted by Professor Atwater in his researches upon food, with 
some very curious results. On comparing two tables of the amounts 
of food consumed by workings-men, he struck two cases where the 
heat units of the food said to be consumed were double that of a 
German soldier on a forced march. Thinking there must be an error 
in the statement, he investigated more closely. In both cases he 
struck a brick-yard ; one in Somerville, Mass., the other near Middle- 
town, Conn. In both these cases the proprietors had found that they 
could obtain the greatest tale of bricks by feeding their workmen with 
the largest amount of beef : the dietaries were correct at double the 
amount of food consumed ?jy the German soldier. 

When computed by the day the requisite amount of food seems 
small ; three to five pounds of solid and liquid food to an average 
working-man ; by the year, however, according to our extravagant 
mode of using food, so much of which is wasted, each adult needs to 
have prepared for him two hundred to three hundred pounds of meat, 
about two hundred pounds of flour, making two hundred and eighty 
pounds of bread, fifty to one hundred pounds of milk, fifty to one 
hundred pounds of butter, fifty to one hundred pounds of sugar, six 
hundred to seven hundred pounds of vegetables, one hundred pounds 
of salt, pepper, cheese, fruit, spices, and sundries, making from fifteen 
hundred to seventeen hundred pounds in all. In many cases, in the 
families of the well-to-do, a ton of f,ood is converted to use or to 
waste, as the case may be, in each year for each person. The flour, 
meat, and butter may be brought over the railway one or two thousand 
miles at the price of a day's wages of a working-man. 

In the pastvfevv years all the utilitarian sciences have been wonder- 
fully developed, and scientific methods have been applied in almost all 
arts relating to the production and distribution of materials ; but there 
is one art, perhaps the most important of all in its relation to the mate- 
rial, moral, and intellectual welfare of the community, to which little or 
no science has as yet been applied ; in which there is no well devel- 
oped technical art capable of being taught upon a scientific method, or 
of being learned except by empirical practice, and that empirical prac- 



The Missing Science. 341 

tice is usually conducted by a very ignorant class of persons. That 
factor in life uyjon which comfort, health, and strength most fully de- 
pend has been almost entirely overlooked, ignored, and neglected to 
the end that I can find no book treating this subject which even 
approaches the standard of science as applied in the other arts ; no 
attempts are made to teach this fundamental art, on v/hich we all 
depend, that are above the level of a mere jumble of empirical devices. 
This fundamental science to which I refer is the science of applying 
heat to the materials which we eat, commonly called cooking. I think 
that you will all concur with me in this statement when I set before 
you the facts which are capable of illustration, and which will be illus- 
trated by the apparatus now before you.' In any family in which two 
kerosene lamps, each having a circular wick of one and a quarter to 
one and a half inches diameter, are burned for the purpose of lighting 
the household four hours, a sufificient amount of heat is wasted to cook 
fifty to sixty pounds of bread, meat, and vegetable food, with the ex- 
penditure of one quart to three pints of kerosene oil, . costing by the 
barrel, for the best quality, two and one half cents per quart. Sixty 
pounds of cooked food would be sufificient for the supply of fifteen adult 
working people. 

In this oven which is made of wood-pulp one inch in thickness, I 
can prepare four charges of food in eight hours ; two charges of ten 
pounds each of bread, two charges of fifteen pounds each of fish, meat, 
vegetables, and puddings. By its use a family of five persons can do 
every thing but fry ; they can stew, simmer, bake, and roast in this 
oven, and can readily prepare twenty pounds of food a day, with a 
consumption of oil not exceeding two cents' worth. 

I have placed in this oven three and one half pounds of round 
steak, with one half pound of suet, two pounds of corned-beef, two 
pounds of salt codfish, one half pound salt pork, three pounds of veal, 
one pound of ham, two pounds of potatoes, one half pound of beets, 
one half pound of carrots, one pound of cornmeal, one pound of oat- 
meal, and one and a half pounds of milk, making nineteen pounds in 
all, combined in six different dishes, the total cost being $2.10. These 
are all dishes which require long, slow cooking, and they have been 
subjected to the heat of the lamp for four hours. The corresponding 
starchy food which should be added to this rction of meat and other 
articles would be sixteen to twenty pounds of bread, sixteen to twenty 
pounds of potatoes, and a few condiments. The whole cost of sixty 
pounds in this combination, which would be cooked on the same day in 
this oven, with one quart of oil costing two and one half cents, would 
be $3.20, making sixteen full rations at twenty cents each for an aver- 

' This was written for a club, and while being read twelve separate preparations of 
food were cooked in two ovens with two lamps. 



342 The Industrial Progress of the Nation. 

age working-man, or twenty average rations for a working-woman not 
engaged in arduous or mechanical labor. 

In this other oven of a little different construction I have prepared 
some rather fine cooking ; the contents are four pounds of the best 
sirloin and tenderloin steak, cut very thick, without bone or flank, pre- 
pared with mushrooms ; three pounds of halibut a la crhne j eight 
quail, a dish of macaroni, a dish of stewed celery, a dish of salsify, or 
oyster plant. There is hardly room for the right proportion of pota- 
toes with these six dishes, and I have therefore decided that the family 
oven for a family of eight persons should be two inches longer in order 
to make room for the additional quantity of vegetable food called for 
with this quantity of fish and meat. A good deal more could be put in 
if tin pans were used instead of vegetable dishes, but I think that fine 
cooking is better done in porcelain or in china than in metal. 

Now when we consider the nature — I may say the infernal nature 
— of the common cooking range or stove or frying-pan, as commonly 
used, especially infernal in summer in the small houses and dwelling- 
places of the working people, T think that you will be prepared to 
admit that there has as yet been no practical science in applying heat 
to the cooking of food. There has been a great deal of art and 
perhaps some science applied to the preparation of food to be cooked, 
but this is a separate matter. 

Now, when we bear in mind that the price paid for the materials of 
food by ninety per cent, of the people of this country takes up one half 
of the income of the family, or more, I think that you will again concur 
with me that there is no new science which could be presented for your 
consideration of greater importance than the science in which I pro- 
pose to make a crude beginning at this time. 



Let me refer to the common impression that the rice-fed coolies of 
India and China are very strong, and that they derive their strength 
exclusively from their diet of rice. Now rice is almost all starch ; it 
contains a very small amount of protein, or nitrogeneous material, 
which is necessary for the formation of muscle ; hence a rice-fed popu- 
lation would be an under-fed population. In a recent report which I 
have received, made on behalf of the English government, the compe- 
tition of India wheat with that raised by English farmers is treated, and 
the limit of production of the wheat which can be exported is stated to 
be the amount of available land which can be spared from the cultiva- 
tion of rice and pulse. That y^oxd pulse reveals the secret ; leguminous 
plants, peas, beans, and the like, are rich in nitrogen, and by that report 
it appears that a much larger proportion of land is devoted in India to 
the cultivation of the pulse crop than to the rice crop. There is also 



The Missing Science. 343 

an upland rice of which we know little in this country, which I have 
reason to believe is more nutritious than the swamp rice. 



While the ordinary cookery book is deficient in any scientific 
instruction, yet there is one noted cookery book which contains a 
famous receipt — Mrs. Glass, in her celebrated receipt for cooking a 
hare, says : " You must first catch your hare." In my instructions for 
cooking I lay down the rule : " You must first catch your heat, and 
then keep it where it will do the work in the right way." 

My first hint how to do this was derived from a description of the 
Norwegian Cooking Box ; I had never seen one. The instinct of the 
Norwegians had taught them that the most suitable buildings for their 
climate should be built of timber and plank massed together in thick 
walls, wood being the most effective of all non-conductors of heat that 
could be put to common use. 

The Norwegian cooking apparatus consists of a box of wood lined 
with hair felt, or fur, and then with metal. A smaller box made of 
metal, adapted to receive the food, fits loosely in this outer case. The 
space around this inner box is filled Avith boiling water, and the heat, 
being kept in by the non-conducting outer wall, does its work upon the 
food, of course at somewhat below the boiling point. This proves at 
once to you that there is no necessary connection between the boiling 
point, which at our sea level is 212 degrees Fahrenheit, and the degree 
of heat necessary to do the cooking of our food. This fact was dis- 
covered by accident, even by Count Rumford, who had thought that 
the way to boil meat is to boil it, when, in fact, the way to spoil meat is 
to boil it. A leg of mutton was accidentally left by him all night in 
a drying room used for other purposes, and exposed to a heat from 
about 140 to 180 degrees, as I remember the statement ; in the morning, 
to Count Rumford's surprise, instead of being dried up, it was nutri- 
tiously cooked and of full flavor. 

In order to convert the Norwegian Cooking Box into a constant 
cooker, all that was necessary for me to do was to add a circulatory 
apparatus similar to the one with which your bath boilers are heated. 
This was the apparatus which I brought to a meeting of the club three 
or four years ago. Into it a working-man may put the materials for a 
hearty breakfast, light the lamp, go to bed, and on getting up find his 
breakfast ready ; but with that apparatus I could only simmer and 
stew, and the American people will not be satisfied with stews. In 
some of the reports of the lectures which I gave to the working-men, 
when put on file in the public libraries, curious comments have been 
made. For instance: "We don't want your pigwash," "We won't 
have bone soup ; we want sirloin," etc., etc. I have therefore substi- 



344 ^^ Industrial Progress of the Nation. 

tuted a column of heated air for the column of heated water in this 
oven, in which you can not only simmer and stew, but also roast and 
bake. There is, as you will observe, no direct communication between 
the lamp, or source of heat, and the inside of the inner oven, in which 
the food is placed ; therefore if the lamp smokes or gives off fumes of 
kerosene oil, for want of being rightly trimmed, the food is not tainted. 

I have made no attempt to promote the general introduction of 
this apparatus, until it should be completely perfected and reduced in 
cost. My first experimental ovens were wholly made of metal, filled 
with non-conducting material, and were costly. We have used this 
appara,tus in my own family for more than one year, and have done, at 
least, nine tenths of our cooking with it. We have been obliged to 
light the range to warm the kitchen, and, it being lighted, some of the 
breakfast cooking has been done on it. I also light my household 
with kerosene oil, as I detest gas-light. Our family consists of from 
ten to twelve persons ; I buy the best oil by the barrel, and it costs me 
ten cents a gallon. My bill of oil for lighting and cooking for the year 
has been thirty dollars. 

A lunch has been established for the employees in my own office, 
as well as for myself. About twenty persons are served with a sub- 
stantial mid-day meal every day ; since we began a little over four 
thousand meals have been served. We are obliged to buy our oil in 
small parcels, at retail prices, therefore the cost of fuel has been seven 
tenths of a cent per meal ; at wholesale it would have been one half a 
cent. The plan works to the great benefit of the employees, whose 
mid-day lunch, or dinner, costs them eighteen to twenty cents each for 
food and fuel. 

Astonishing as these facts are in regard to the economy of fuel, I 
am of the opinion that this is purely a secondary matter ; economy of 
food is of the first importance, coupled with the saving of work on the 
part of the cook. I have proved, I think conclusively, that the oper- 
ation of heating a room, or of heating water for circulation through 
the house, is absolutely inconsistent with the true methods of cooking. 
Heat cannot be properly regulated for cooking when applied to other 
purposes. If I were to build again, I should make arrangements for 
heating the water from the furnace, with a small heater set alongside 
the furnace for summer use, and in place of the range in the kitchen 
I would put a small heater, like a flat-iron heater, with a place to boil 
water on the top. One of my friends has built and furnished a house 
in this way and is quite enthusiastic over it. I might add a grill, which 
is very useful in any household, but my main dependence for cooking 
would be upon the lamp, or Aladdin, oven. 

In the development of the science of cooking I think it will ap- 
pear that there is a true degree of heat by which flavors are developed 



The Missing Science. 345 

or actually created ; for instance, if we grind green coffee we get no. 
good result and no true flavor ; if we roast it too much we destroy the 
flavor and get an acrid and impalatable residuum. If we apply the 
exact degree of heat to roasting the berry, we develop the flavor and 
other qualities which are desired. I have lately observed that the 
same rule seems to apply in the application of heat to meat, fish, vege- 
tables, and meal, especially cornmeal. If not cooked enough, meat 
will be sapid and flavorless ; if cooked too much, flavorless and soggy \, 
if cooked at the exact point, the finest flavors are developed, especially 
in fish and fruit. 

The advantages which are beginning to be apparent in the use of 
these ovens are as follows : 

First : In respect to bread. Bread baked twice the usual time at 
300 to 320 degrees Fahrenheit does not quickly become covered with 
a hard crust, as in the common stove. This crust when formed is a 
non-conductor, being like wood, carbonaceous in character ; this pre- 
vents the penetration of heat, so that the interior of the loaf is not 
cooked. It is also said that in such case the yeast plant is not killed and 
may go on fermenting, or else the bread moulds quickly or dries up. In 
bread baked in my oven the heat penetrates to the very centre ; it may 
be eaten fresh with impunity, and can be kept sweet for many days. It 
may even be over-baked with good results. In some of the over- 
baked loaves, especially those which are three or four days old, there 
is a crust-like flavor throughout, probably due to the partial conver- 
sion of the starch into dextrine. I have kept bread of this kind in 
good condition for eight days. 

Second : In respect to meat. It begins to be apparent that the 
right method of cooking meat is to keep it at such a degree of heat as 
will cook it without dissociating or " cracking " the animal fats or 
converting the juices into volatile vapor. Cooked in this way tough 
meat becomes tender. I also find that in proportion to the freedom 
from the smell of cooking is the flavor retained. I am informed by 
physicians that when animal fats are cooked in this way the fats of the 
meat remain nutritious and digestible, whereas, if the fats are exposed 
to a high degree of heat, so that the volatile parts are " cracked," or 
dissociated, the remainder of the fat becomes acrid and indigestible. 
It is possible that we may impute the prevailing dyspepsia of the 
day to the highly heated ovens of the range or stove in their effect 
on fats, as well as to the frying-pan. 

There is one point which requires a little skill : it is difficult to brown 
meats or poultry so as to give as good an appearance as is desirable. 
We have succeeded fairly well in imparting a brown appearance and 
appetizing look to many of our dishes by the skilful use of powdered 
crackers and butter, which brown more readily than the fat of the 



34^ The Industrial Progress of the Nation. 

meat itself. But, in order to give a fine aesthetic effect to a bird or a 
joint, all that is necessary to be done is to have a larger lamp, or such 
as I call a J^umbo lamp, whose wick is nine inches in circumference, and 
which is 1 60 candle power, for final use. A short and careful applica- 
tion of this lamp for ten or fifteen minutes does the work of browning 
extremely well. 

I have taught three cooks of average capacity how to use these 
ovens each in a single lesson, and they have never served a meal in 
which any part was spoiled. Occasionally some kind of vegetable 
(vegetables requiring a higher degree of heat than meat), with which 
we were not perfectly familiar, has been served underdone. Sometimes 
a big joint of meat has not been kept in the oven quite long enough. We 
have been obliged to experiment with each oven ; each has a different 
normal, so to speak ; but we have cooked to perfection in comparison 
with any other method, sirloins of beef weighing twenty-four pounds, 
turkeys, and geese weighing eighteen pounds each, a whole saddle of 
venison, which weighed, untrimmed, twenty-five pounds, and also 
single pounds of meat and small birds; all weights and kinds have 
been put to the test. Parts of the meat, like the flank of the sirloin, 
which are spoiled when roasted with the joint, we cut off and simmer 
in the cooker, and afterwards convert into the most appetizing dishes 
in the oven. 

Again, meat which has not been subjected to a high degree of heat 
makes a better hash or mince, and has no unpleasant tang. It would 
be difficult to distinguish between two turkeys, one re-heated and the 
other freshly cooked ; I attribute this to the fact that the fats are not 
dissociated by the low temperature, and there is no flavor of grease 
rendered. 

This is all I yet know about this somewhat crude invention some- 
what crudely used ; the whole field of this new science remains to be 
explored. I have somewhat to my own surprise, lately come into 
possession of a small literary income. I have somewhat the same 
feeling about it that I had when I received a check for my first article 
printed in the Atlantic Monthly ; it did not seem to belong to me, I 
therefore expended it for Christmas presents, and my children were 
somewhat surprised at my unwonted liberality. The next year, not 
liaving received a check, my presents were smaller, and my little girl 
asked me why I did not give them more. 

" I have no money to spend this year," I replied. At which she 
rejoined : 

" Well, papa, I think you might write another article for the 
Atlantic ; anybody might do that ! " 

But when one is engaged in active business, and can only give little 
bits of time to literary work, without any real opportunity for consecu- 



The Missing Science. 347 

tive thought, a literary income hardly seems earned. I have therefore 
devoted the fee of an article yet to be written to experiments conducted 
by Miss Marion Talbot, under the superintendence of Mrs. Richards, 
at the Institute of Technology, by which I have, at least, partly proved 
that all my theories are well grounded. 

Miss Talbot's report is a model in scientific form. After describing 
the personal equation, and after referring to the eminent olfactory 
abilities of one of the professors, she says : " Miss Talbot came to the 
work with some training in physics and chemistry, a knowledge of 
housekeeping and marketing, considerable ease in turning from one 
occupation to another, and almost uniform failure in the few attempts 
she had made to cook in an ordinary stove or range. Miss Bragg's 
ignorance in regard to cooking was still greater, but was offset by 
promptitude, intelligence, and ability to conquer obstacles. The in- 
experience of the cooks, which at the outset seemed to doom the work 
to failure, from an epicurean standpoint, is noteworthy in view of the 
exceptionally good culinary results obtained." 

The quantity of each dish prepared was sufficient to supply from 
three to six persons. The varieties of food treated were bread, baked 
potatoes, baked apples, beefsteak, macaroni, rice pudding, roast chicken, 
mutton chops, apple tapioca, escalloped potatoes, baked custard, baked 
haddock, roast beef, bread pudding, ham, gingerbread, mince pies, 
rolls, chowder, corn bread, apple dumpling, with foam sauce, baked 
halibut, grouse, and citron cake. 

Reference is made to the particularly fine flavor of cornbread and 
fish. Escalloped potatoes were successfully made from raw potatoes 
cooked slowly in milk. The cracking point of the animal fats was not 
reached except in the small oven, and a little difficulty in the browning 
is referred to. In conclusion Miss Talbot says : " The economy, 
cleanliness, and simplicity of the ovens has been amply demonstrated. 
They are certainly magnum in parvo, and, if it were not for the Yankee 
determination to have omnium in parvo, the claim might be made that 
they can do all the work that could be fairly demanded." 

Many of you will recall the half-hour's entertainment which I 
attempted to give you two or three years since at the house of a late 
valued friend and fellow member, when I came to the house clad in an 
eight-dollar suit, with my supper in a small cooking box, and showed 
how a man could live comfortably and be well nourished on an income 
of $200 per year. I was not myself entirely sure whether I was quite 
serious in the matter, and whether my cooker might not be a mere play- 
thing. Since then I have come to a more certain conclusion. I may 
sometime prepare, with the aid of Professor Atwater, a large number of 
scientific daily rations ample for a working-man, to cost from twenty- 
five cents each per day down to ten cents. At twenty cents an ample 



348 The hidustrial Progress of the Nation. 

variety of nutritious food can be prepared in either one of these ovens 
by a single man or woman at as low a relative cost as for a large num- 
ber. The whole supply for the day can be cooked over the evening 
lamp, a part to be re-heated for breakfast and dinner on the next day, 
without losing its appetizing quality. 

In order to maintain my reputation as a man of figures, I will re- 
peat again the sum which might be saved to the people of the United 
States. The average expense of a working-man in full work is twenty- 
five cents per day for the materials of food ; the measure of waste at a 
moderate computation is twenty per cent., or five cents per day. This 
includes the waste of rich and poor alike ; of the first-class hotel 
and of the factory boarding-house. The consuming power of the 
United States at the present time is that of over fifty-two million 
adults, counting two children of ten or under as one adult, and the 
objective point of my work is to save five cents a day on fifty-two 
million, which would amount annually to about one billion dollars. 

(In order to save myself a part of the burden of correspondence on 
this subject, I may venture to state that circulars giving prices and 
direction for the use of the Aladdin Cooker and Oven can be had 
on application to Kenrick Brothers, Brookline, Mass.) 



A SINGLE TAX ON LAND 



A SINGLE TAX ON LAND. 

THIS proposition, which has been sustained with so much sincerity 
and ability by Mr. Henry George and his coadjutors, for the col- 
lection of all public revenue, both for national, State, and mu- 
nicipal purposes, by a single tax to be imposed upon the valuation 
of land, has attained a strong hold upon the minds of a considerable 
number of able and sensible men. Many of them are, however, per- 
sons who can hardly claim to have given much attention to the problem 
of taxation before this theory had been brought to their attention. 
This theory is apparently so simple, and would seem to be so effective 
in practice, that it appeals to the imagination, but it may not stand the 
test either of history or of logical analysis. 

This plan is not new ; it originated with the school of economists 
known as the Physiocrats of France, whose principal exponent was 
Quesnay, and whose theory in respect to land as the source of all value, 
and therefore a right subject for all taxation, was substantially brought 
into public notice by Turgot, the great finance minister of Louis XVI., 
whose fall preceded the French Revolution ; it opened the way for 
some of the final abuses of power which led up to that great event 
which has worked so much both of evil and of good to humanity. 

Turgot's theory, which Henry George now sustains in respect to 
land, continued to exert great influence after his fall, and greatly 
affected the legislation of the Republic, leading to some of the worst of 
the financial disasters of that period. Reference may be made to Leon 
Say's " Life of Turgot " and Blanqui's " History of Political Economy " 
for the records. 

The consideration of this theory of taxation has been rendered 
more difficult at the present time by the manner in which it has been 
presented as a cure for poverty. Doubtless poverty may be aggravated, 
or in some special cases it may be caused by a bad method of taxation, 
but he who expects poverty to be cured by the organization of Anti- 
Poverty Societies, coupled with a change in the method of taxation and 
a change in the conditional possession of land under the laws of the 
State, must inevitably be disappointed. 

It is very difficult to follow the somewhat vague conceptions and 
the tortuous reasoning of the supporters of the single-tax theory, and 

351 



352 The Industrial Progress of the Nation. 

they frequently object that what they intend to do is not comprehended. 
If they would present a legislative act for carrying the single tax into 
■effect, these alleged misconceptions would disappear. Their prime 
object appears to be to force land into wider distribution by the weight 
of taxation, and at the same time to relieve the people from a part of 
the weight of taxation by putting all taxes upon land or upon what they 
•call the site value of land. This sounds a little like adding to the bur- 
den in order to lighten the weight, but it may oe admitted that some 
heav) loads can be borne when rightlv distributea better than lighter 
loads can be when concentrated in the vvrong place. If. however, all 
people possess all land under the new conditions of possession sug- 
gested by Mr. George and his coadjutors, then all people who possess 
the land must contribute their portion of all taxes. But taxes cannot 
be derived from land without work. Raw land may support a vagrant 
and sparse population of hunters or shepherds, but true civilization 
x;ould have no existence until land began to be fenced in and held in 
possession, because the product of the soil necessary to subsistence is 
a product of work, and land must be fenced in and occupied in order 
that it can be worked, and must be permanently possessed in order that 
it may continue to be productively worked. 

Taxation means work ; the method of taxation is only a method of 
•distributing the products of work. This work may be work of the 
head, of the hand, or of the machine, or of all combined. It is meas- 
ured when in the process of distribution in terms of money, but the 
money itself stands for work or is derived from work. Wages, profits, 
salaries, rents, and also taxes are alike derived from the annual product 
of the four seasons, constituting the result of a year's work of the 
whole community. In this respect it matters not where the tax may be 
imposed in the first instance, somebody must work in order that the 
products may be brought forth from the mine, the forest, the field, or 
the factory, of which the tax constitutes a part. The work of govern- 
ment is as much a part of the work of the community as any other. In 
this work men, women, and boys are employed, from the President of 
the nation to the page in the House of Congress, including all the 
officials in the custom-houses, courts, post-offices, and the like. These 
public servants must be supplied with shelter, food, and clothing, and 
in order to supply them others must work in the production of build- 
ings, grain, meat, fibres, and factories, from which the taxes are paid. 
In the city the mayor, the common council, the firemen, the police, and 
the women who scrub the floors of the public buildings must be sup- 
plied with shelter, food, and clothing, and those who pjay the city taxes 
do the work which is necessary to furnish this supply. The main 
question at issue must therefore be limited to one principal point. At 
what point, on what product, in what place, on what subject, or on 



A Single Tax on Lajid. 353 

what process of work, mental, mechanical, or manual, that can be taxed, 
ought the taxes to be placed in the first instance ? How can the taxes 
be imposed so that the money shall be secured with the least injurious 
effect upon the occupations of the people, and so that the burden of 
taxation shall be most equitably distributed among those who must do 
the work, mental, manual, or mechanical, from the product of which 
these taxes are derived ? How shall taxes be assessed so as to be in 
proportion to the ability of those upon whom they fall in the first 
instance to pay them ? When this view of taxation as a mode of work 
is presented, a wide field is opened for the choice of subjects for 
taxation. 

As nearly as the figures of our national and State accounts enable 
us to make a computation, the sum of all our taxes — national. State, and 
municipal — comes to about six per cent, of the value of our annual 
product in a normal year, this annual product being valued at the point 
of ultimate consumption ; conversely, six per cent, of all our work, or 
about that percentage, is and must be devoted to the support of gov- 
ernment, since the value of the annual product is the measure in money 
of the work that has been done by the whole community of which the 
work of government is a part. 

It will doubtless be admitted by all competent persons that the 
taxes should be imposed so as not to impair the productive power of the 
community as a whole. In what does this productive power consist ? 
May it not be held that it is divided into three parts, representing dif- 
ferent directions of mental, mechanical, or manual force ? 

Does it not consist, first, in mental capacity ; that is to say, in the 
capacity of those who by way of invention, by the application of 
science, or in some other way of applying the work of the head rather 
than the hand to the conduct of the \vork of society — save the com- 
munity a large part of the mechanical work and manual work which 
had been necessary, or which would otherwise be necessary were it not 
for the application of this mental factor in production ? Is not the 
mind of man the prime motor in all material production ? 

Does it not consist, second, in the direction or application of the 
natural or mechanical forces either in the primary, secondary, or sub- 
sequent processes of material production under the control of skilled 
workmen, tending to the saving of a great part of the manual work or 
labor previously required ? As the mind of man is the prime factor, is 
not skill the equally necessary secondary factor ? 

Is not the third application of force that of mere manual labor or 
work of the muscle rather than that of the mind to the primary and 
crude processes of production ? 

If these three phases of productive energy be considered in ratio to 

their relative effect upon the joint product, does it not become evident 

23 



354 ^^^ Industrial Progress of the Nation. 

at once that those who occupy the third position or lowest plane, al- 
though most numerous, will be capable of producing the least quan- 
tity of exchangeable products in ratio to the quantity of work, labor, or 
time which each may devote to a specific branch of industry ? Is it not 
also evident that those who are in the second and third classes, or in 
the various gradations by which one class merges into the other, may 
obtain results or products of greater and greater value somewhat in 
inverse proportion to the mere manual or physical effort or to the time 
which each may devote to his respective branch of work ? Does it not 
follow that those who are capable of taking position in the higher 
planes may in a few hours' work produce vastly more than is required 
for their own subsistence, while those in the lowest plane may only be 
capable in long hours of work of producing enough for a bare subsist- 
ence? If then, heavy taxes should be imposed upon those who occupy 
the lowest plane, taking from them by taxation a part of that meagre 
product which is necessary even to their bare subsistence, that system 
of taxation might reduce them from poverty to pauperism. 

On the other hand, if the same amount of taxation should be im- 
posed, in the first instance, upon those who are in the higher planes, all 
of whom produce much more than is necessary for their own subsist- 
ence, may not such taxes only take from them a small part of that 
which they can spare without in any way affecting their productive 
ability or diminishing their necessary consumption, either of their own 
products or what their own products can be exchanged for ?. Does it not 
then follow that taxes should be imposed as nearly as may be in ratio to- 
the productive capacity of those upon whom the taxes are assessed, 
sparing as much as possible those whose productive capacity barely 
suffices for their own support or taking from them by way of taxation 
only such products as are not necessary to subsistence but are more or 
less of voluntary use, such as whiskey, tobacco, and beer ? 

There is no charity in such a view of taxation ; it is consistent with 
the keenest business sagacity. The burden upon the members of the 
community who can pay and who must pay will be greatly increased if 
taxes are so imposed that those who have been poor but yet have been 
self-sustaining, should be forced to become paupers either by heavy 
taxes on the necessaries of life or on the land of which all must occupy 
a part. 

It should be remembered that there can be no great elasticity in that 
part of our taxation which is absolutely required to meet the necessary 
expenses of the government. It varies with the duties or functions 
imposed upon the government. I have said that our present taxes come 
to about six per cent, of the value of our entire product, but there is 
no absolute basis for this computation. In 1880, I think, the rate was 
considerably higher. There is, however, a certain sum, whatever it 



A Single Tax on Land. 355 

may be, that must be devoted to the support of the government every 
year, even though the product of one year may vary very greatly from 
another. It has been very truly said that " there is nothing sure but 
death and taxes." Now if some persons produce much more than 
they can consume, while others produce barely enough, then it follows 
that if the assessment of the necessary sum of taxation is not put in 
the first instance upon those whose productive capacity is the greatest, 
then it must fall upon those whose productive capacity is the least : 
this view leads again to the expediency of putting the taxes where 
they can be most easily collected without injury to productive capacity ; 
that is, upon those classes who possess the greatest productive capacity 
either in the possession or use of land ; in the possession or use of 
capital ; or in the mental power or skill which enables them to render 
large services for which they may receive large compensation. In 
this view of the matter, an income-tax would be the surest measure of 
the productive capacity either of the man himself, or of the land, capi- 
tal, or skill with which he may be endowed, consequently an income- 
tax might be the ideal tax, were it not for certain practical difficulties 
which forbid it being the chief source of revenue. A succession-tax 
— that is to say, a tax levied upon bequests of property — might also 
be one of the most feasible and judicious sources of revenue, and why 
such a tax has not been more deeply considered and more commonly 
adopted in this country, is one of the difficult questions to answer. 

On the other hand, may not a tax limited wholly to land valuation 
be as far removed from a tax assessed in proportion to the productive 
capacity of a community as can well be conceived ? Raw land of 
itself produces nothing more than might suffice for the support of a 
vagrant population of hunters or shepherds. The productive capacity 
of a man is neither measured by the land which he owns or occupies. 
It is measured by what he can do for other men better than they can 
do it for themselves, whether by the use of mind, muscle, machinery, or 
land, and by that measure his income will be greater or less. Neither 
is a man paid in proportion to the land occupied in his work, nor for 
the quantity of the physical effort which he puts into his work ; neither 
is he paid by others according to his own estimate of the service which 
he renders to them ; he is paid, or he earns income according ,to the 
estimate of those whom he serves, of the labor or work which he saves 
them from doing, which they would otherwise be obliged to do for 
themselves if they tried to serve themselves in the same way. A man's 
income is therefore measured by his capacity to save other people a 
part of the struggle for existence, and since there is no compulsory ser- 
vice and no compulsory payment either of wages, profits, or rent, 
in this country, each man can be said in the long run to fix for himself 
the rate of his own wages, his own earnings, or his own rents, by the 



356 The Industrial Progress of the Nation. 

amount of capacity or capital which he puts at the service of those 
who pay him for the use of his land, capital, head, or hands. 

If then, we could tax men exactly in proportion to their productive 
ability or capacity, we might reach and secure a share of the annual 
product of the community in an equitable manner, while at the same 
time taxing it at a point where the tax would limit further production 
or draw upon the necessary subsistence of the community in the least 
measure. 

The answer to this proposition by the advocates of the single-tax 
system may be, that a great many men are forced to devote a large 
share of their work, or to pay others a great deal of money without 
getting any adequate return from them, because some men own or 
control the land while others have none ; it being held by them that 
any payment of rent for land is not conditioned upon service. It is 
held that men who hold land under the present conditions of posses- 
sion do not earn the rent upon land, and that rent is paid simply 
because some men own or control the land while others have none ; 
therefore, it is held that rent may be something that is not rightly due 
or that is not equitably earned. 

At this point the difference begins in respect to the true source of 
production from land which must control the true science of taxation. 
It will be admitted that all material productions are derived in the 
first instance from the land, the forest or the mine, with the slight 
exception of products gathered from the sea. The sea is not divided 
or owned to any great extent, — only the waters near the shore. All are 
free to derive their food from the sea outside a narrow shore line, if 
they choose to do so. Land is, however, the main source of crude 
products ; but these crude products must be converted and re-con- 
verted and must be wholly changed from their primary form before 
they are ready for ultimate consumption. More value can be, and is, 
added to these crude products by those who do not work directly 
npon the land than by those who work directly upon it in the primary 
processes. Therefore land must be considered as of the same nature 
as all other instruments of production, effective only in ratio to the 
work put into or upon it. 

There is a fallacy even in attributing all crude products to land 
only. Land soon fails in its inherent properties or power of primary 
production and will in a very short term of years fail to sustain any 
considerable, population. It will only yield a permanent product in 
ratio to what is put into it. What is put into it is capital and this cap- 
ital is applied with more or less labor. Capital in a material form is a 
product of past labor saved and converted to reproductive use by the 
service of those who do the present work. Land, labor, and capital 
must therefore of necessity cooperate in order that either may be of 



A Single 77? X 011 Land. 357 

adequate service in the subsistence of mankind. Both land and capital 
are inert without the service of labor, and labor is also incapable of 
abundant product without capital or land. A tax upon land which 
might restrict its use or upon capital which might impair it in amount 
and render its service less effectual, would therefore ultimately fall 
most oppressively upon labor which cannot wait. In respect to rents 
it is admitted that the money that is derived from the sale of the 
crude products of the forest, the soil, and the mine, is divided among 
those who do the actual work and those who own or hold conditional 
possession of the soil, the forest, and the mine under existing laws. 
This share which those who possess the land now receive in the form 
of rent is what is aimed at by the advocates of the single-tax system 
upon the theory that private rent can be converted into public taxes. 
It is held by them that if this rent could be secured by taxation under 
the new system of the conditional possession of land proposed by Mr. 
George and his associates, then this rent vv^ould suffice to meet all the 
expenses of government, and that those who now subsist upon these 
rents would then be compelled to go to work for their living, if they were 
not already working. That is to say, they hold that if rents or rental 
value could be diverted from private to public use, the burden of tax- 
ation which would become a substitute for the burden of rent would 
be so much derived directly from land and that it could not be distrib- 
uted ; therefore it is affirmed that those who now subsist upon rent 
would be obliged to work, and those who now pay the rent and taxes 
would save one or the other, and would have more leisure and more 
to spend upon themselves for other purposes. 

When the subject is presented in this way the main questions are 
at once brought out : 

ist. Does land produce any product available for rent or taxes 
without work ? 

2d. Are land and labor in the limited sense in which the word 
labor is commonly used to designate the manual, mechanical work of 
the person who applies physical force or manual labor directly upon 
the land, the only factors in the primary production of the crude prod- 
ucts of the soil ? 

Or, in other words, if all land were either held in common or in 
severalty, free from private possession and free from rent but subject 
to a single tax, would labor when in possession of land but without 
capital be capable of sustaining a community ? The advocates of 
the single-tax system, and Mr. George himself would immediately 
answer this question in the negative. They admit that the possession 
of land and the application of capital to it by private persons under 
certain conditions established by law, are an absolute necessity to 
abundant production, and that both capital and labor must be 



358 The Industrial Progress of the Nation. 

applied to land and are therefore necessary even to the collection 
of the single tax which may be put upon land. What is the limit 
of the production from land unless capital is applied to it ? It needs 
but a moment's reflection to prove that land and labor without capi- 
tal would be wholly incapable of sustaining a civilized community ; 
it matters not whether the capital be only a rude hoe or a pointed 
stick with a handle to it, to be used for a plow ; or a steam plow and a 
self-binding reaper. Some kind of capital must be placed at the 
service of man, or else the laborer himself could barely subsist even 
on the best land. Has it not been proved conclusively by experience 
that in proportion to the quantity and effectiveness of the capital 
applied to land is the quantity of labor diminished and the quantity 
of product increased ? Is it not also true that as the quantity of crude 
products derived from the soil is increased by the application of capital 
and the adoption of improved machinery, the more abundant produc- 
tion gives the workman of the present day a wider opportunity and a 
better subsistence in the struggle for existence than he ever had 
before ? 

Again, if land without capital is almost useless and incapable of 
production, then a tax on productive land is undoubtedly a tax on the 
capital and labor applied to it. 

The contention of Henry George and his coadjutors is, that since 
production comes in the first instance from land, all people should have 
some share in all land ; but since land and labor by themselves are 
incapable of abundant production without capital, does it not follow of 
necessity that all who have a share in all land must of necessity also 
have some share in all capital ? Otherwise of what use would the land 
be to them ? What is this but Socialism or Communism if brought 
into effect by legislation ? 

Conversely, does it not follow that if private property in capital or 
in things already produced from the soil, the mine or the forest, is 
admitted to be necessary to the use of land, then private property in 
land under similar conditions must also be admitted to be necessary to 
the use of capital upon it ; first^ in order that there may be an abun- 
dant product, yielding a surplus to be saved for conversion into capital, 
and second, in order that this capital may be applied to reproductive 
purposes upon the land ? 

The institution of private property in land and things has been 
developed not only because it is necessary to the subsistence of those 
who own the land and capital, but in order to make it possible that the 
laborer should exist at all. The term owri is relative ; there is no abso- 
lute private property or ownership either in land or capital ; both are 
held in conditional possession subject to all that is implied in the 
power of the State to exert its right of eminent domain. All that 



A Single Tax on Land. 359 

Henry George and his associates have as yet proposed is a change in 
the terms of the conditional possession of land ; they have not sug- 
gested Communism or Socialism, although their theory might lead to 
that conclusion if carried into effect. 

If there is any truth in the considerations which have been pre- 
sented, the proposal to secure all public revenues from a single tax on 
land does not rest upon any abstract principle of right. In fact it 
would be difficult to prove that any fundamental principle of taxation 
has yet been established which can be said to form part of a science 
which can be applied in all times and all places, and to all conditions 
alike. In the present state of our knowledge it is almost a necessity 
that the method of taxation should be treated almost wholly as a 
question of expediency, and on general principles it is not expedient to 
put a tax where it will obstruct production. 

It is therefore in the first place expedient to consider the conditions 
under which capital may be voluntarily applied to land, since no com- 
pulsion is possible in the nature of the case. 

With respect to farm land, no one will improve, fence, or drain it, or 
erect farm buildings, unless he can obtain permanent possession under 
some sort of title of an individual kind, such as would warrant him in 
exerting his labor and expending his capital with a view to future 
results. What is the present cause of the poverty of the agricultural 
laborer in Great Britain and Ireland except that he has been debarred 
from the possession of land under permanent conditions, either by 
-custom or by a bad system of land tenure ? 

Again, will any man construct an expensive building upon a city lot 
or a costly factory by the side of a stream, unless he can be sure of the 
permanent possession of the land on which he invests his capital ? If 
land is not improved, that is, if capital is not applied to its improve- 
ment, its quality cannot be maintained and erelong it will cease 
to yield any adequate return to the labor which is put upon it. When 
it ceases to yield any adequate product will it not then cease to bear 
any valuation upon which the taxes can be assessed ? Could it then be 
assessed at a rental value or a site value, or could the taxes be col- 
lected if the product failed to yield any thing above a meagre subsistence 
to the squatters upon it ? Does it not then follow that land is a mere 
instrument or tool of production, and that it cannot be made a possible 
source of rent or taxes, except in proportion, not to the labor or 
capital, but to the labor and capital which may be applied to its culti- 
vation and use ? 

A city lot possesses even less inherent value than a farm ; a farm 
may possibly yield something for the subsistence of labor even without 
capital, but a city lot from which the loam has been taken and which is 
hardly big enough to feed a rabbit upon if planted in clover, can 



360 The Industrial Progress of the Nation. 

produce neither rent, profit, nor income, except in proportion to 
the capital which may be expended upon it. 

True, both farms and city lots may be the subject of purchase or sale, 
but the price that is paid is not paid for any permanent value or any 
inherent power in the land simply as land to yield either rent or taxes ; 
it is paid for the choice of position. The capitalist will pay a high price 
for a city lot in order to have an opportunity to put expensive buildings 
upon it which may be used as instrumentalities either of production or 
distribution. The capitalist who pays the highest price for the choice of 
the highest-priced city lots does so because at that place the commu- 
nity can be served at the least cost — for the reason that these lots are 
in the most convenient situation for the community to reach in order to 
buy their goods. The price is paid for the choice of land. 

It will be alleged in rejoinder that the high price which may be paid 
for the choice of position is due to the growth of society, and that any 
gain which one may make by holding these lots until society settles 
around them is the so-called " unearned increment." It is admitted 
that it sometimes happens tha^t a man who holds a vacant lot for a long 
period may secure a large profit, and the profit which he derives is not 
due to any work which he himself puts into the lot, but to the growth 
of society about it. This "unearned increment" has been greatly 
exaggerated, and is very largely a matter of the imagination ; but 
whether it is or not, it is evident that if the possessor under the present 
condition of our laws has no right to any sum this " unearned incre- 
ment " may produce, then he has no right to secure a profit on any thing 
due to the lapse of time. There is no difference between this " un- 
earned increment " upon a city lot or farm and the " unearned incre- 
ment " on a share of railroad or of factory stock, or a ton of wheat, or 
any other product of the land. A man who buys a share in an unfin- 
ished railway, and keeps it until the growth of towns along the line 
raises the price of the stock, has as m.uch right to that advance in price, 
and no more, than the man who had the foresight to buy a city lot at 
the risk that even interest and the present taxes might deprive him of 
any ultimate profit. Men often build factories in advance of the de- 
mand ; presently the growth of the population increases the demand 
for the fabrics ; then follows a rise in the price, due either to greater 
consumption or to the increase of population. Has he no right to the 
increased value of the goods made in the factory, because it is due to 
the increase in population ? Or a man buys at a low price a lot 
of wheat, foreseeing or hoping to get a higher price in the future ; if 
he is wrong there is an unrequited decrement which society has not 
yet proposed to take upon itself ; if he is right in his exercise of his 
own judgment and foresight he gains ; to whom does that gain be- 
long ? 



A Shigle Tax on Laiid. 361 

If, then, land is like every other tool or instrument of production, 
in being capable of yielding product only in ratio to the labor and cap- 
ital applied to it, it must be considered like any other instrument of 
production as only one of the sources of the annual product to which 
value is imparted in the process of exchange by the joint work of all 
who take any part either in production or distribution, whether they 
be laborers or capitalists. 

If this be admitted, it then becomes expedient to explore the sub- 
ject a little further and to find out what part of the ultimate value of 
all products has been derived from land considered as the source of 
primary production. Of course it will be admitted that there can be 
no material work done except by men who plant their feet upon the 
soil somewhere. Every man must have a position on the soil some- 
where, whereon to rest the lever with which he moves the natural forces 
towards the subsistence of man ; but the contribution of the different 
classes of men to the ultimate value of the annual product at the point 
of final consumption may almost be held to be in inverse proportion to 
the quantity of land occupied. For instance, it requires from six to 
eight thousand acres of land and about one thousand laborers to pro- 
duce about five thousand bales of cotton in a season, at the pjresent 
meagre proportion of product per hand and per acre. But thai five 
thousand bales of cotton may be doubled or trebled in value, and brought 
from the crude condition in which it is unfit for use into the finished 
fabric suitable for clothing, in a factory which covers but a fraction of 
an acre of land. 

Again, a man may be occupying an attic ten feet square in the upper 
story of a city building, by whose work the future capacity of that fac- 
tory may be doubled. It is not many years since I paid a visit to such 
a man, working in a miserable attic in a cheap city building, by whose 
invention the productive capacity of every boot-maker in New Eng- 
land was more than doubled. He was the first inventor of sewing- 
machines in which a waxed thread could be used. 

A part of what the government needs, and must secure by way 
of taxation, may be six per cent, of the cotton fabrics made in the 
factory, such fabrics to be used in clothing the government employes. 
The science of taxation will therefore consist either in putting a tax 
upon the field where the cotton is raised or on the site where the factory 
is built, /. e., on the land applied to cotton and cotton fabrics. This is 
the policy advocated by Mr. George and his coadjutors ; otherwise a 
tax may be put upon the goods delivered from the factory, or on the 
cotton in the bale, or on the warehouses where the goods are stored or 
from whence they are distributed, or on the railways that move both cot- 
ton and goods, or upon the property and incomes of the owners of field 
and factory and railway. Another way to secure money for the govern- 



362 The Industrial Progress of the Nation. 

ment is to put up the taxes upon some other products which are con- 
sumed by those who raise cotton or make cotton goods, such as whiskey, 
sugar, tobacco, beer, and silks, and fancy goods, and other articles, all 
•of which the workmen upon the cotton plantations and the workmen in 
the factories may or must consume. Another way to secure the neces- 
sary revenue for the government is to put a tax for local purposes upon 
the value of the cotton plantation, upon the value of the cotton factory, 
and upon the value of the warehouses where the products are distrib- 
uted, according to their respective place and value. Which of these 
taxes would be most likely to obstruct the production of the cotton 
farm or of the cotton factory ? Therein lies the whole question of 
equitable taxation. At what point and in what place can the national 
and State governments secure from the cotton industry, or from any 
other branch of production, that part of the supply of cotton goods, 
food, or other products that the employes of the government must have 
in order that they may be subsisted ? When viewed in this light it 
becomes apparent that the productive capacity of those who work upon 
the cotton field barely suffices for their own support, while the produc- 
tive capacity of those who own or operate the railways by which the 
cotton bale is moved or produced from the field to the factory, suffices 
for the support of the railway owners, railway employes, and also, when 
unobstructed by meddlesome statutes, may or does yield a large sur- 
plus over, which may rightly be subjected to a tax. It may appear 
that the only thing that can be taken from the laborers on the cotton 
fields, without injury to their productive capacity, may be a part of the 
whiskey and tobacco which they consunae ; it may be that those who 
work in the factory barely earn a subsistence, and that what can best 
be spared by them would be a part of the silk, ribbons, and fancy 
goods, or the whiskey, beer, and tobacco which they consume, if by 
taxation these things cost more, and are therefore consumed less. 

Lastly, it may appear that a well-conducted factory in which large 
capital and a small quantity of labor are directed towards the produc- 
tion or conversion of cotton into cotton fabrics, or of wheat into flour, 
or of iron and steel into machinery, — may yield subsistence to all the 
operatives and also furnish an income for the owners more than sufficient 
for their subsistence. Therefore that property in the cotton factory or 
in the machine-shop or warehouse might, as a whole, and not simply 
the land only, be a just and expedient subject for local taxation. 

It may be assumed that since the consumption of whiskey, beer, and 
tobacco in this country is fully equal to the entire sum of all taxes, both 
national. State, and municipal, it may be both just and expedient to 
tax these articles which are of voluntary and not necessary use, to the 
fullest extent, since both workmen, artisans, landlords and tenants, 
clerks, and owners of capital, will all be as capable of productive 



A Single fax on Land. 363 

energy and even more capable of effective service, the less these 
articles are consumed by them. 

If then, the productive capacity of man is, and may be in inverse 
proportion to the quantity of land held or occupied by him, does it 
not follow that while land may be an expedient subject for a part of the 
taxation it may not be rightly subjected to all taxes under the single- 
tax system, without the danger of very grave injury to the whole 
people ? Moreover, if land were thus made subject to a single tax 
sufficient to meet the expenditures, it might be a great injustice to col- 
lect this tax from those who hold land according to its present value, 
and if such an attempt were made it would probably limit or reduce the 
conditional possession of the land to a few large capitalists rather than 
to bring about a wider distribution of land among the less prosperous 
classes. 

Again, if the single-tax system is sound in principle, it should of 
-course be made the single source of all public revenue, — including both 
national, State, and municipal taxes, — and it should then be ajjplied to 
all land, farm land as well as city lots. There can be no variation in 
the application of a prificiple of taxation, but when a method of taxa- 
tion is treated upon the ground of expediency, a different rule f>erhaps 
might be applied to farm land and city property ; into that branch of 
the subject there is no reason to enter in this treatise. 

If the advocates of the single-tax system had been farmers, holding 
the average amount of land and working their holdings year by year in 
order to gain a subsistence for their families and to sell a sufficient 
amount of the product of their farms to enable them to buy clothing, 
groceries, and to pay even their present local taxes, the promoters of 
this theory would more fully comprehend than they do now how diffi- 
cult it is for the average farmer to set aside even money enough to pay 
the present taxes, which constitute only a part of the revenues re- 
quired by the State, county or town, and which do not include any con- 
tribution whatever to the equal need of the national government. 
They might then realize that the source from which this money is 
derived is not the land itself ; they would then become aware that the 
product of the land, especially in Massachusetts, is not due to any in- 
herent fertility in the soil, but is due in part to the capital put into the 
soil in fertilizers ; in part to the capital applied to the soil in machinery 
and tools, but mainly to the very hard work of the head and labor of 
the hands which is put into the processes of production by the farmer 
and his men who drive the plows and direct the motions of the farming 
tools and machinery, to say nothing of his wife and daughters who do the 
work of the kitchen or the dairy and supervise the hen-yards. The 
advocates of the single-tax system might then become aware in a prac- 
tical way, if they never knew it before, that land by itself has no power 



364 The Industrial Progress of the Nation. 

of production and no power of subsisting any one except hunters or 
Digger Indians who live upon wild roots. They might then discover 
that a tax on land must be paid by work, and that it would be only a 
tax on work disguised under a specious fallacy. 

Let us suppose, however, that the single-tax system had been 
adopted, and that the farmer must pay by a single tax on land not only 
the taxes now assessed upon his farm and buildings, which now in part 
support the local government, but also all the rest of the taxes for the 
support of the State and municipal government, such as the taxes that 
are now assessed upon the railways, upon banks, insurance companies, 
and all other kinds of property — all of these must then be paid by the 
land. The farmer, having then earned this sum in addition to his pre- 
sent taxes, and set aside enough for the county, State, or town, will then 
find out that the requisitions of the national government are as great, as 
those of the States and towns. He may then discover that although 
the expenses of the national government might be somewhat diminished 
yet even when* reduced to the lowest terms the amount of the national 
taxes is equal to the local taxes. The national government now re- 
quires for the civil department : ist, legislative, executive, judicial, and 
foreign expenditures, and for the construction and maintenance of 
public works, not less than $6 r, 000,000 each year ; 2d, for the naval 
establishment, including the construction of a navy, even of a very 
moderate and limited sort, not less than $20,000,000 ; 3d, for the mili- 
tary establishment, including very moderate provision for fortifications 
and public works of that sort, not less than $39,000,000 ; 4th, for the 
interest on the public debt, at the present time at least, $40,000,000, 
therefore omitting pensions and the sinking fund (and assuming what 
is the fact that all miscellaneous expenses are met from miscellaneous 
permanent receipts, such as the sale of the public lands, receipts from 
consular fees, and the like), yet the necessary revenues required by the 
national government to meet the ordinary expenses reduced to the low- 
est terms would not be less than $160,000,000. In addition to this, until 
the public debt is all paid, the requirements of the existing law in respect 
to the sinking fund increase rather than diminish, calling for not less 
than $50,000,000, while the sum required for pensions is over $80,000,- 
000 a year ; for current annual pensions, about $50,000,000 ; for ar- 
rears, about $30,000,000 ; the national revenue absolutely required 
therefore amounts to about $290,000,000. Therefore the annual con- 
tribution of the people to the support of the government and to the 
debt and pensions must be at least equal to the sum now assessed upon 
property for the support of State and municipal corporations which 
does not exceed that sum. Exact comparison cannot be made, because 
the data of local taxation are not as perfect as they might be. This abso- 
lutely necessary expenditure of the national government is now met in 



A Single Tax on Land. 365 

considerable part by duties and internal taxes which are assessed upon 
articles of more or less voluntary use, so that any man who does not 
choose to contribute may, by giving up the consumption of a few 
things which he can do without (and perhaps be the better for doing so), 
put his part of the national expenses upon those who choose to pay 
for it. 

At the present rate of income, the national government secures year 
by year a little over $100,000,000 from i?itoxica7its — that is from "the 
taxes or duties upon distilled spirits, wines, and beer ; from tobacco, 
$40,000,000 ; from sugar and molasses, $52,000,000 ; from manufactures 
of silk, $16,000,000 ; from fine linens, over $5,000,000 ; from laces, em- 
broideries, and fine fabrics, which are of the nature of luxuries rather 
than necessities, made of cotton and worsted, from $17,000,000 to $20- 
000,000 ; from furs, fancy goods, fruits, sardines, and other articles of 
like kind, about $20,000,000. The sum of the national taxes imposed 
upon articles which maybe considered luxuries, or articles of voluntary 
use rather than necessities, comes to $250,000,000, which contribution, 
is more than sufficient to pay all the necessary expenses of the govern- 
ment and the sinking-fund and nearly all the current annual pensions, 
the remainder of the pensions being collected from other duties than 
those enumerated above. When the debt and pensions are paid, the 
government will be able to spare all the taxes now derived from to- 
bacco and sugar, and these war taxes may rightly be abated when the 
financial burden of the war is lifted by the payment of the debt and 
pensions, if not before. 

Now if the question were put to the farmer whether he would 
prefer to be assessed by a single tax upon his land, or to contribute his 
proportion by a tax on his glass of whiskey or beer, even on his sugar 
and molasses, or by way of the laces and ribbons which his wife and 
daughters buy for their Sunday clothes and bonnets, it is probable that 
he would not hesitate long in which way to make his contribution to 
the national expenses. In fact, there are very sound reasons why it is 
expedient that the national revenue should be in some part collected 
by indirect taxation, and should be imposed mainly upon articles of com- 
mon even though not of necessary use, so that the ratio of the national 
taxes should be more nearly in proportion to the population than to the 
valuation on property. This system of indirect national taxation, which 
may be paid about /^r capita, may be justified, because the function of 
the national government is rather to give protection to the people of 
the whole United States than to the property of the several inhabitants 
of the particular States, which is fully protected under State laws. 
Moreover, if the national government elects by vote of the people to 
collect this revenue, and to maintain custom-houses for enforcing this 
system of taxation, this method is not inconsistent with the true prin- 



366 The Industrial Progress of the Nation. 

ciple of free trade, as alleged by Mr. Henry George. Custom-houses- 
may be maintained for the single purpose of collecting the revenue^ 
without any conflict with the theory that foreign commerce should be 
free from taxation imposed for purposes of private gain. In fact, if 
the government is to collect any part of its revenue by an excise on 
spirits, beer, and tobacco, it becomes absolutely necessary to maintain 
custom-houses in order to tax imported wine, beer, and tobacco in the 
same way. Hence even the most bigoted free trader may justify custom- 
houses for the purpose of securing a revenue from specific articles. 

Again, let it be supposed that the taxes are to be put on land, 
including farm land, does it not follow at once that the man who 
possesses land and labor supplemented by iiisufficie7it capital may 
become unable to get such a product from farm land as would enable 
him to subsist and pay his taxes ? What would of necessity ensue ? 
Would it not be that under this system, land would fall more and more 
into the possession of great capitalists, who, by the application and use 
of machinery, fertilizers, and other improved methods, might be able 
so to increase the gross product of a given area of land as to enable 
them to pay wages to those who are now independent farmers, and in 
addition to secure from the land such product as might enable them to 
meet the taxes ? This course might perhaps be justified as the right 
method of getting the largest amount of product from land in ratio 
to the labor put into it, but the justification of this course runs in 
exectly the opposite way to that upon which the single-tax system is 
sustained. It would tend to concentrate the land in the hands of a 
few capitalists rather than to increase the number of small farmers or 
of small holders of land under the new conditions, or to cause land to 
become more widely scattered among a greater number of people. In 
other words, the small owners or possessors of land, who may, by their 
indomitable industry, now get a subsistence from it, and gradually be- 
come possessed of capital requisite for the increase of its product, might 
be crushed by the additional burden of the single tax. Increase the bur- 
den of taxation upon the small farmer and it may happen, and it probably 
would, that the greater part of the land Avould be taxed out of his posses- 
sion, instead of the number of independent farmers being increased. 

Again, if we take city lots as an example, and suppose them to be 
subject to the single-tax system, we are led inevitably to the same con- 
clusion, to wit : that the single-tax system would tend to concentrate 
the possession of city lots or land in very few hands, and would ere- 
long convert all small owners into tenants — the very reverse of what 
has been aimed at by the promoters of the system. This subject can 
be illustrated by an examination of the present condition of the city of 
Boston, and by comparing the taxes as they now are with what they 
would be if the single-tax system were adopted. 



A Single Tax on Land. 367 

The sum required for the annual expenses of the city of Boston is 
a httle under $12,000,000. Of this sum $10,000,000 is directly as- 
sessed upon property within the city. The remainder is derived from 
taxes upon corporations, savings-banks, and the like, collected by the 
State and distributed among the cities and towns. The total value of 
the property within the city, as given by Mr. Thomas Hills, Principal 
Assessor, under whom the present system of assessment has been de- 
veloped in the most perfect manner, was in 188S, $764,000,000— divided 
as follows : valuation of land, $333,000,000. The valuation of build- 
ings $230,000,000, and the valuation of personal property, aside from 
that which is taxed through the State, a little under $201,000,000. 
The direct tax upon property, as now assessed, on land, buildings, and 
personal estate has been at the rate of about $13.50 per $1,000 
in recent years. The debt of the city is kept nearly at the maximum 
permitted by law, and there are few who do not think that some of the 
expenditures for which money is borrowed might not well be included 
in the estimate of taxes. If, however, the revenues which are now 
required, aside from the debt, were raised by a single tax on land, the 
rate of taxation would rise from $13.50 per $1,000 and would be not 
less than $35 per $1,000, for city, county, and State purposes only. 
The population of the city is in cound figures 400,000, their share of 
the national tax averaged /^r capita comes to a little within $2,500,000. 
If this national tax were assessed by a single tax on land, the amount 
which would be assessed in Boston would be vastly increased. What 
the ratio of the value of the real estate in Boston to the total value of 
real estate assessed throughout the country at the present time may 
be it is impossible to say. In 1880, the valuation in Boston of land 
and buildings was three and one third per cent, of the total valu- 
ation of land and buildings throughout the United States assessed 
for the purposes of local taxation. The population of Boston at 
that time was only three quarters of one per cent, of the total pop- 
ulation of the United States. Such might be the ratios in many 
other cities. Assuming the same ratios to hold at the present 
day, and that Boston should be called upon to pay its share 
of the national expenses assessed by a single tax on land, and 
that Boston land bears the same ratio to the valuation of the 
United States that it did in 1880, her proportion of the present na- 
tional revenue would be $12,000,000 in place of $2,500,000 ; raising; 
the rate of assessment under the single-tax system to over $70 per 
thousand — $35, or one half, for State and municipal expenditures, 
and $35, or one half, for national expenditures. What effect would a 
tax of seven per cent, upon the present valuation of property have 
upon its future market valuation, or upon its rental value which must 
be determined for the purpose of being subjected to the single tax 1 



o 



68 The Industrial Progress of the Nation. 



Would not such an assessment instantly deprive land of a large part, 
if not of the whole of its market or salable value ? To this the advo- 
cates of the single-tax system may assent and may affirm that this is the 
conclusion which they desire to reach. They may then hold that any 
person who desires to become possessed of apiece of land might then 
do so without paying out any considerable sum of money for the pur- 
pose of primary possession. But what would be the €011(111(011,3 2 Anyone 
might perhaps become the conditional possessor of a piece of land 
with little or no cost at the outset, but it would only be on 'condition that 
before he him^self could get any benefit out of it he must make use of 
it in such a way as to be able to pay a sum equal to seven per cent, 
of its present valuation, before being able to set aside any part of the 
product of the land for his own use. Or, put it in another way, let it 
be assumed that the people of Boston or any other city 400,000 in 
number were subjected to the payment of a tax of $24,000,000, — 
$12,000,000 for State and municipal purposes, and $12,000,000 for na- 
tional, — that comes to $60 per head, or S300 a year for each family of 
five persons. Under these conditions any one who might choose 
could become entitled to apiece of land previously unoccupied in Bos- 
ton, free of cost for purchase, but subject to the condition that he and 
his family numbering five persons should earn by the use of that land 
$300 per year, to be devoted to the first lien of the State and nation ; 
/. e., to the single tax, before setting aside any thing from their work for 
shelter, clothing, or subsistence. Under these conditions what benefit 
would the conditional possession of land under the single-tax system 
be to the poor man ? Could any one but large capitalists afford to 
accept even a gift of land under such conditions ? Would not the 
tendency of these conditions be to depopulate the peninsula of Boston, 
and to concentrate the land in fewer hands than possess it at the 
present time under the present conditions ? 

Again, suppose that this did depopulate Boston and other cities: 
and did tend to the diffusion of population, would not the burden of 
taxation go with them to other land which they would then occupy ? 
Wherever they might find an abiding-place, there the single tax on land 
would extend over the land which they might occupy, because the 
growth of society adds the unearned increment to the site value of 
land according to their own theory, and the tax would go with the site 
or rental value. 

Or again, let it be assumed that the same people would remain in 
Boston, that some one would accept the possession of land under the 
new conditions, and that it would either cost them nothing, or that it 
would cost them but a small part of the present valuation in order to 
obtain such possession ; how would the single tax of $24,000,000 then be 
assessed ? There would either be no valuation of land to serve as a 



A Single Tax on Land. 369 

•guide for assessment, or else there would be a valuation very much 
less than the present, while there would be no change in the burden 
or amount of taxation, therefore if the valuation went down the rate 
would go up. Advocates of the single-tax system say that the site 
value or rental value of each lot would remain, owing to the existence 
of a dense population and the necessity for the use of such lots, even 
though the cash or money valuation had disappeared wholly or in part. 
Who would then determine the site value or rental value of each lot, 
and in what way would the title be vested in those by whom capital 
must be spent upon the land in order that it may be of any productive 
use whatever ? Would it not become necessary for the city itself to 
enter into contracts for taxation upon the site value or the rental value 
at a fixed rate for long terms of years ? Who would occupy land or 
spend any capital upon it if subjected to such a heavy burden, unless 
under a permanent agreement or bargain, which would simply be 
holding under a lease from the State or city ? What would that be but a 
continuance of the worst form of land tenure— the possession of land 
under a perpetual ground-rent ? 

These are simple and practical questions. The sum of all taxation 
required for national, State, and municipal purposes in the United 
States is not far from $700,000,000 ; if that whole sum is to be raised 
by a single tax on the valuation of land, that part which would fall 
upon the cities is indicated by the simple fact that the share of the city 
of Boston would be $24,000,000. The share of other cities and towns 
would be in similar proportions. The share falling upon the best 
farm land would also be much greater than it now is, and the share 
falling upon poor land or land now uncultivated and unoccupied would 
be very small. It would then of necessity follow that only those who 
possessed large capital could afford to hold or possess lands under 
the new single-tax conditions either in the cities, towns, or the best 
positions for farms ; while the very poor, in proportion to their pov- 
erty, would be forbidden the possession of land except at points t^ie 
most distant from the centres of industry. To this conclusion the 
logic of the system inevitably tends : what answer can its advocates 
give to these propositions and these demonstrations ? 

The case must be considered theoretically, because there is no 
community now existing in which the public revenues are derived from 
a single tax upon land or site value. The nearest approach to the sys- 
tem was made by the Directory of the French Republic. It broke up a 
very bad system of land tenure, wholly different from any thing known in 
this country, and led through great disasters to the present system of 
compulsory land distribution to which France is now subjected. 

The writer is not to be held as fully approving either of the present 

method of collecting the national taxes, or the present method of 
24 



37o The Industrial Progress of the Nation. 

assessing both real estate and x^ersonal property for municipal pur- 
poses, there are great improvements which may be made in both 
branches. What he h^-s endeavored to prove is that there is no 
abstract principles of taxation by the application of which either the 
causes of poverty may be removed or land forced into wider distribu- 
tion or more productive use than under the present conditions. Taxa- 
tion is as yet an experimental science to be tested by its results and 
brought by experience into the conditions under which the largest 
revenue required for the use of the government economically adminis- 
tered may be raised with the least burden to the people and the least 
obstruction to their free choice of the pursuits which they may follow 
in bringing forth from the soil, the factory, the mine, or the sea that 
annual product from which all taxes, wages, earnings, profits, and rents 
must be alike derived. 

We are now led back to the consideration of the only grounds 
upon which the single, tax system might be justified, to wit : given a 
certain sum necessary to the support of the government to be derived 
from a single-tax upon land, — given a certain sum of rents derived 
from land by private owners and now enjoyed by them which would be 
more or less sufficient to meet the necessities of government, whatever 
the actual facts in regard to the sum of rents may be ; given as com- 
plete an act as it might be in the power of men to devise to secure to 
the people by a single tax upon land a sum equal to the rents now 
secured by private persons through their possession of the land under 
existing laws, such sum to be devoted to the support of the govern- 
ment and all other forms of taxation done away with ; — would those 
who might then come into the conditional possession of land under 
these new conditions of a single-tax tenure thereafter be capable of 
distributing the tax upon the consumers of the products derived 
directly from the soil, or converted in factories, or distributed in ware- 
houses ? In other words, would the conditional possessor of land 
under the new system bear all the taxes and be incapable of securing 
rent or profit or both rent and profit from land ? Would there not be 
a distribution substantially of the same kind, in the same amount, and 
upon the same persons that now do the work from which rents and 
taxes are now derived, — whatever kind of work, mental, manual, or 
mechanical, that work may be ? The sum of all the taxes would be 
the same that it is now, — the sum of the gross value of the product 
would be subject to the same variation that it is now ; — that is to say, it 
would vary with the seasons and with the amount of capital and labor 
which might be applied to production. The amount of all work of all 
kinds would be substantially the same that it is now ; a certain pro- 
portion of the people would of necessity be devoted to agriculture, 
another proportion to the mechanic arts, another proportion to manu- 



A Single Tax on Land. 371 

factures and mining, another to trade and transportation, and another 
to professional services. Would the joint product of all these forces 
be increased or would it be distributed in any more equitable or even 
manner ? If not, the change in the conditional possession of land 
might not be worth the cost and difficulty of the undertaking ; if oth- 
erwise, the change might be justified. 

Again, taking once more the three examples of the farm, the factory, 
and the warehouse : the number of persons in possession of sufficient 
capital who could make use of land for cultivation would probably be 
lessened if the occupant were called upon to submit in each year to a 
first lien of taxation through the land upon its crops to double, treble, 
and quadruple the amount which the farmer is now called upon to pay. 
A great number of small farmers now gaining a fair subsistence by their 
own labor and due in least proportion to the use of capital might then 
be compelled to take the position of the employed rather than the em- 
ployer. No capital would be invested in farming unless the product 
of the farm could be charged, first, with all the taxes imposed upon the 
land as part of the cost of production, and, second, charged with all wages 
paid and materials used upon the farm, as a part of the cost of produc- 
tion. Unless in addition, over and above these elements of cost, a 
customary profit, interest, or compensation for the use of capital and 
for the services of capitalists could also be recovered from the sale of 
the products, the products of agriculture would be diminished until 
they could be so charged. Under these conditions, the tax upon farm 
lands, equal under the new conditions to what both rent and taxes 
now come to, must ultimately fall wholly upon the consumers of farm 
products. 

Next, in respect to factories, the area of land occupied by the largest 
factories and those that are the most productive, is very small in pro- 
portion to the product of the factory, and as steam and electricity are 
rapidly supplanting or taking the place of water-power, the choice of 
position for large factories may be made almost at will with a view to 
occupying lands of a minimum rental or taxable value. Under these 
conditions it would probably happen that the large factories would 
be relieved from a considerable part of the present burden of taxation 
upon them if they were called upon to pay a tax only upon the land. 
Under the present conditions the owners of capital in the factory have 
no difficulty in charging the heavy tax to which they are now subject, 
to the cost of the goods, and unless they can recover the cost of mate- 
rial, the wages paid and the taxes as well, from the sale of the product 
with an adequate compensation over and above to pay for the service 
of that capital and for the support of the owners, that branch of manu- 
facture fails to extend, and may even ultimately fail to exist. Since 
the consumers of goods made in the factory now pay all the heavy 



372 The htdustrial Progress of the JSation. 

taxes upon the goods made in that factory, would not a single tax on 
land of less amount be as surely put into the goods, and would not the 
consumers be forced to pay that tax ? What effect would such a single 
tax on land have upon the profits of the owners of factories ? 

In respect to the mechanic arts customarily conducted in small 
shops or buildings less costly in proportion to the product than the 
factories, and which must of necessity be placed in the neighborhood 
of the population who are served by the mechanics, — a single tax upon 
the land occupied would, without question, increase the burden of the 
occupants far beyond their present share of taxation. Or again, unless 
under this single-tax system the mechanic could recover from the sale 
of his product adequate remuneration for the tax, he would not occupy 
the land and would not pay the single tax. In point of fact, the bur- 
den on the mechanic would be a little heavier than it now is, and 
would surely be distributed upon those who consume the products or 
require the services of mechanics. With respect to mines : if all taxes 
should be assessed upon land, including land underlaid with coal, iron, 
and other mineral products, the proportion now borne would doubtless 
be greatly increased ; but in this case, unless those who occupy the 
mines under the new conditions could recover the labor, profits, taxes, 
and interest in substantially the same proportions and in the same way 
that the present taxes are now recovered from the consumers of the 
products of the mines, these mines would not be worked to the same 
extent which they are now worked, prices of the products of the mines 
would rise, and ultimately the consumer would pay all the additional 
taxes upon mining lands in addition to the present cost of mining 
these products. 

Or in respect to city warehouses, the highest rents are now paid for 
the choice of position whereon to place, the largest buildings, most con- 
venient for distribution. These excessively high rents, however, add 
to the cost of distribution muc-h less than the low rents of small shops 
in which a relatively small traffic is carried on. If the single-tax system 
is adopted, and all taxes are paid upon land, the burden will fall most 
heavily upon city lots, as illustrated in the example of the city of 
Boston, but in this instance again, unless this increased burden due to 
the single tax on land can be charged to the cost of distributing the 
goods sold in the warehouses, coupled with a suitable charge for the 
services of those employed therein, the work will not be done in that 
way. When the warehouse is taxed out of existence in which the cost 
of distributing goods or wares is least on account of the facilities which 
it gives, the burden upon the consumers would increase ; they would 
pay a much greater sum than they now pay for the cost of distribution. 

If these would not be the results of this system, what would they 
be ? The advocates of this system of a single tax on land are invited 
to answer this question. 



A Single Tax on Land. 2^']-^ 

If the reasoning on which this treatise has been prepared is logical 
and conclusive, it therefore follows that the attempt to put the charge 
for all public revenues wholly upon land, while it might do away with 
an element of charge now called rent in part or wholly, and while it 
might alter the sum paid for the choice of position and for the occu- 
pation of land under new conditions, — yet it would tend on the whole 
to concentrate the conditional possession of land in fewer hands and 
make it a much greater necessity that the occupant of land should also 
possess a considerable capital than is now needed. It would not tend 
to an increased product, and it would not remove from the consumers 
of the products any part of the burden of taxation or of the rent they 
now pay. It would not in any way affect the process of distribution 
except by increasing the disparity between the rich, the moderately 
well-to-do, and the workman who depends wholly upon his work for a 
living. The proposition can therefore neither be sustained as a true 
principle of taxation nor as an expedient method of raising the public 
revenues. 

The final conclusion of the whole matter might be summed up in a 
very concise statement : land attains value in exchange (rental value 
or site value, whichever term may be applied) only in ratio to the use 
to which it may be put as a source of primary production, or as a place 
on which production can be continued or from which distribution 
can be made. Land cannot be divided or in itself applied directly to 
taxation, because taxation is only one mode of distributing the prod- 
ucts of land. Production cannot be secured without work ; a tax on 
land is therefore a tax on all the work of production and distribution 
in practically even proportion without regard to the quality of the 
product or the distribution : it falls on all work, whether the product 
be necessary to life or of voluntary use, and whether the distribution 
be a mode of necessary consumption or of luxurious consumption. 
Ninety per cent, of all the people of this country belong in some sense 
to the working class, according to the narrow interpretation in which 
that term is commonly used ; that is to say, they work for a living, 
either directly upon land, or serve others either for small salaries or 
for moderate wages, producing little more than is necessary for their 
own consumption. Perhaps about one tenth of the community may 
be counted among the more prosperous class, that is, among those 
whose previous earnings have been saved in sufficient measure to re- 
lieve them in part or wholly from the necessity of present work or to 
aid them in doing much more work than is needed for subsistence. A 
single tax upon land can only be a tax upon all production ; it would 
therefore be a tax upon all consumption of every kind, and therefore 
might be a true method of distributing the burden of cost of the gov- 
ernment upon every class without discrimination and without regard to 
the relative productive capacity of any member of either class. 



3 74 ^^ Industrial Progress of the Nation. 

The merits of the system of a single tax upon land would be that it 
could be readily and surely collected, and that the burden of such a tax 
would force the attention of every man and woman to the necessity of 
limiting the expenditures of the government to the least possible sum 
necessary to the conduct of its functions. 

The fault of the system would be that it would leave no room for 
expediency in relieving those least capable of sparing a part of their 
product in order to put that burden upon those whose productive 
capacity might be greater. It would also do away with the discrimina- 
tion now somewhat blindly exercised in the choice of subjects for 
taxation, by relieving whiskey, tobacco, beer, and other articles of 
voluntary use or luxuries from all taxes. The whole subject must 
therefore be reviewed upon the grounds of expediency and not of 
principle. As a principle of taxation, a single tax upon land might be 
very equal in the burden which it might impose upon all consumers, 
but would it be equitable in the manner in which it would prevent the 
division or distribution of this burden in ratio to the productive 
capacity of each producer ? 

In this attempt to treat the subject of taxation, I have been led 
almost in spite of myself to the conclusion that the only way in 
which those least capable of being taxed, because least capable of 
making a large product, can be exempted in some measure, from the 
necessary weight of taxation, is through a system of indirect taxation 
upon consumable goods rather than upon property ; for the reason 
that wherever or however taxes are wholly imposed upon property 
(except by a succession tax), the owner of the property, whether in 
land or capital, can find out a way of distributing the tax and of 
collecting it from others ; while an indirect tax assessed upon con- 
sumable products may be avoided wholly or in part by him who 
refrains from consuming any such subjects of taxation. For this 
reason, so far as public revenues can be derived from whiskey, beer, 
tobacco, and wine, or other similar articles of purely voluntary con- 
sumption, such a tax may be the most expedient, least burdensome, 
and although not equal yet perhaps the most equitable mode of 
collecting a considerable part of the revenue, with the least injurious 
effect upon productive energy. This conclusion has been reached by 
the writer by divesting the mind as far as possible of the conception of 
money as a measure of taxation, and by treating taxation wholly as a 
mode of work subject to be paid in greatest proportion in the first in- 
stance by those whose working capacity, either mental, mechanical, or 
manual, is greatest, or by those who know how to make the most pro- 
ductive use either of land or capital, wherever the burden may 
ultimately fall when the tax is finally distributed. 



RELIGION AND LIFE 



RELIGION AND LIFE. 

IN the preface to this book I have given the motive of my literary 
work. 

For nearly fifty years I have been engaged in the practical work 
of this world, occupied in the functions of life which the priest in 
almost all churches and under all the various phases of religion has 
been apt to disparage and to hold in slight repute. 

The result of my own observation and experience has sufificed to 
convince me, if it may convince no one else, that the power which 
makes for righteousness compels the very selfishness of man to work 
for the material welfare of his fellow-men. It matters not that the 
stock and bonds of a railway corporation may be converted into the 
loaded dice with which an unconvicted felon can defraud a portion of 
the community ; the railway system to which he may apply such ne- 
farious methods must yet be itself conducted so as to carry food to the 
hungry, clothing to the naked, and shelter to the homeless. The be- 
neficent work which he is compelled to do lives after him ; the evil 
which perverts his own life may be buried with him in his dishonored 
grave. The older I grovv the more profoundly convinced have I be- 
come of the truth of a proposition made I think by Sir Henry Maine 
in one of his works : 

" The trust reposed in and deserved by the many makes the oppor- 
tunity for the fraud of the few." 

In the subsequent little tract, I have referred to my own experience 
in dealing with men for the sale of goods counted even up to more than 
a hundred million dollars' worth, with but fractional loss for lack of 
full and prompt payment when the bills were due. For the last twelve 
years I have been at the head of a Mutual Insurance Company whose 
principal function is to prevent loss by fire in the textile factories and 
other works which are insured by it, paying indemnity when unavoid- 
able loss may occur. The system rests but little upon the legal obliga- 
tions of the members each to the other, but almost wholly upon their 
mutual good-faith. In thirty-eight years this corporation has insured 
over thirteen hundred million dollars' worth of property — yet it has 

377 



3 yS The Industrial Progress of the Nation. 

never been subjected to a lawsuit or been obliged to have recourse to 
a court on its own behalf. In its whole history it has met but one loss, 
which could even on suspicion be imputed to a fire set by an owner or 
manager of the works in order to defraud the corporation, and that 
single suspicion could not be sustained by any adequate proof. I have 
myself been subjected to heavy loss, due to the perversion of trust on 
the part of the head of a great railway corporation, and to deceit prac- 
tised upon the Board of Directors ; I am well aware that base men 
still possess great influence in political life ; yet my confidence in 
human nature remains the same, and my hope of the ultimate attain- 
ment of human welfare is unimpaired. 

The malignant forces which have caused war and wretchedness 
among men, and the perversion of public and corporate trust to pur- 
poses of private gain and fraud, may continue perhaps for a long 
period. There must yet be one great convulsion, perhaps more, in 
other lands away from us, by which dynasties and privileges may de- 
stroy themselves ; yet there again upon the ruins of the past shall surely 
be built up the welfare of future generations of men, and then " the 
ships that pass between this land and that shall be like the shuttle of 
the loom weaving the web of concord among the nations." 

I have endeavored to present this ideal aspect of life based upon 
the study of material things in the subsequent pages, which first con- 
stituted an address a little out of my common line of work, and which 
I have entitled Religion and Life. I submit this essay as the conclusion 
of the whole matter. 

The following essay was prepared for a meeting of the Norfolk Unitarian Con- 
ference, and afterward read at a meeting of the Unitarian Club in Boston. 

The writer had not before taken any part in the treatment of religious subjects ; 
but being impressed with the necessity of bringing the functions of the preacher more 
into line with the necessary work which must be done so long as man dwells in the 
body w.hich he occupies while upon the earth, so that it may be sustained, he ventured 
to hold up the layman's mirror for the clergyman to look upon, in order that the true 
purpose of the material work which men must do might be more justly comprehended. 

The separation of matters pertaining to religion in a technical sense 
from the life which men must of necessity lead has, I think, a great 
deal to do with the waning interest in the religious, or the irreligious 
creeds as some of them may more rightly be named. It may also 
account for the lesser number interested in the organization of churches 
and parishes. The aspect of life to the busy student of affairs, who is 
also occupied in the daily work of business, is one of profound interest 
to him who is capable of looking a little below the surface and compre- 
hending the true function of himself and of his associates. When I 
was called upon a year or two ago to address the alumni of Andover 



Religion and Life. 3 79 

Theological Seminary/ I chose for my subject the intimate relations of 
ethical and economic science ; and, as I desired to make a good appear- 
ance before the graduates, I asked Dr. William Everett to give me a 
Latin phrase by which I might convey in sonorous words the idea that 
unless the human body were well nourished and cared for there could 
be no harmonious development of the human soul or spirit. He in- 
stantly replied, " Non est animus cui non est corpus." Has a man a 
soul whose body does not eat ? Not here, certainly, — perhaps some- 
where else. The sound mind, the true spirit, and the well-nourished 
body are but three phases of the same life, each the complement of the 
other. As Dr. Reuen Thomas said at the opening of our Union the 
other day, quoting from another : '' ' He who treats of food treats of 
morality also.' " If I and other men like me did not preach the potato 
gospel, on what fulcrum would you rest the lever of your spiritual 
gospel ? 

Now, then, according to the old Orthodox creed, the world, the 
flesh, and the devil are held to be absolutely synonymous. Therefore, 
the business man who is occupied in the world with the concerns of 
the flesh, and who really knows what his function is, rejects the whole 
creed without any hesitation. He does not stop to reason or to deter- 
mine in what way the world and the flesh may become of the devil. 
He simply says : '' That man does not know what he is talking about. 
I wont listen to that sort of thing any more." And he stays away from 
meeting, as I should do if I could only listen to the ordinary treatment 
of the subject of religion as practised by most of the Protestant clergy. 
The Catholic symbolism would be much more gracious to me. Is it 
just or expedient that men should be repelled from thinking about the 
true aspect of religion and life by false doctrine ? Religion, in a true 
sense, and life can no more be separated than the soul can be separated 
from the body, except by physical death. Is it not important that 
this very foundation, this fact of existence itself, should become a 
part of the common knowledge and thought of every-day men and 
women ? 

I think the common absolute misconception of the real material 
work of the world and the separation of the functions of religion from 
the functions of life grow out of the old dead creeds. I suppose every- 
body has read " John Ward " and " Robert Elsmere " ; and they may 
have been subjected to the same intellectual difficulty to which I have 
been subjected, — namely, I have found it utterly impossible to put my- 
self in the place of either John Ward and his wife or of Mrs. Elsmere 

' When first dictating this memorandum I made a singular slip by using the words 
" Andover Theological Cemetery" Perhaps I might have let " cemetery " stand ex- 
cept for the vigorous, active, and good work which is now being done there by Prof. 
Egbert Smyth and his associates. 



380 The Industrial Progress of the Nation. 

and her husband. I cannot conceive that the old dogma or necessity 
for a formulated belief should attain such complete control over any- 
well trained or well developed human intellect at the present time. My 
imagination fails to grasp the sense of importance attached to matters 
of belief like those with which the two men struggled. In order to find 
out how such men could exist, it occurred to me to find out how chil- 
dren or young people might be educated, even in our day, so as tO' 
bring them into such a dreadful condition of mind. 

I accordingly started a day or two since on a short walk to the head- 
quarters of the various denominations. I first went to the Episcopal 
counter in the Old Corner Book-store, and asked if they had a creed 
to sell, to which the reply was made : " Yes ; here it is. The price is 
two cents." I bought it and went on to the Congregational building,, 
where I asked a young man if there was such a thing as an Orthodox 
creed. He said he believed they had one ; and he went to the back 
part of the store, hunted about for a while, then called another young 
man to help him find the creed. I thought this a good sign, — that it 
took two men to find one copy of the Orthodox creed in the principal 
Orthodox book-store. I bought that one for two cents. He then in- 
formed me that the Unitarian building was on the next corner, and 
that I might perhaps find a Unitarian creed there. On application I 
was given a copy of James Freeman Clarke's pamphlet called '^ Why- 
am I a Unitarian ? " I then went down to the Tremont Temple, and 
was from there directed to the headquarters of the Baptist denomina- 
tion on Washington Street. The Baptist creed cost me five cents. 
Then I went back to the Methodist book concern in Bromfield Street, 
where the Methodist creed was sold to me for two cents ; and lastly, I 
went to the Universalist bookstore, where they presented me with a 
simple and excellent creed printed on a card, in three articles, without 
any charge. Since then I have secured a Presbyterian creed for ten 
cents. It therefore appears that the price of a creed ranges from 
nothing up to ten cents ; and I find the value to be in inverse propor- 
tion to the price. I particularly like Article III. of the Universalist 
creed : " We believe that holiness and true happiness are inseparably 
connected, and that believers ought to be careful to maintain order and 
practise good works; for these things are good and profitable unto 
men." With James Freeman Clarke's creed you are doubtless very- 
familiar. But now we come to what I cannot help calling, without in- 
tending any want of respect, the antiqite and horrible. If children are 
brought up on spiritual food of the sort contained in these so-called 
religious manuals, ''John Ward " and " Robert Elsmere " are not so 
difficult of comprehension. I will make a few extracts -without identi- 
fying the different creeds, in order to bring out the whole horror of the 
thing in the most conspicuous way : — 



Religio7i and Life, 381 

1. " Q. — What is the inward and spiritual grace ? 

"^. — A death unto sin and a new birth unto righteousness: for, 
being by nature born in sin, a7id the children of wrath, we are hereby 
made the children of grace." 

2. '* We believe in the resurrection of the dead, and in a final 
judgment, the issues of which are everlasting punishment and ever- 
lasting life." 

3. " We believe that man was created in holiness under the law of 
his Maker ; but by voluntary transgression he fell from that holy and 
happy state, i7i consequence of which all mankind are now sinners, not by 
constraint, but by choice, being by nature utterly void of that holiness re- 
quired by the law of God, positively inclined to evil, and therefore 
under just condemnation to eternal ruin, without defence or excuse." 

4 " Of original or birth sin. Original sin standeth not in the 
following of Adam (as the Pelagians do vainly teach) ; but it is the 
corruption of the nature of every man that naturally is engendered 
of the offspring of Adam, whereby man is very far gone from original 
righteousness, and is of his own nature iftclined to evil, and that 
continually." 

5. "By the decree of God for the manifestation of his glory some 
men are predestined unto everlasting life and others are foreordained to 
everlasting death. . . . The rest of mankind God was pleased, ac- 
cording to the unsearchable counsel of his own will, whereby he con- 
cedeth or withdraweth mercy, as he pleaseth, for the glory of his 
sovereign power over his creatures, to pass by and to ordain them to 
dishonor and wrath, for their sin, to the grace of his glorious justice." 

Amid the lurid glare of these unholy flames of hell a faint light still 
burns upon the altar to the unknown God ; and Saint Paul may speak 
to the heathen to-day, as he did to the heathen of old : " Whom ye 
ignorantly worship, him declare I unto you." 

The fifth creed in which these last awful dogmas are to be found cost 
ten cents. Perhaps these extracts are more familiar to the clergy than 
to the laity. I confess that, although I have of course been perfectly 
familiar with the existence of these conceptions which admit the possi- 
bility of righteousness to man only at the cost of imagining Satan to 
have become the Supreme God, yet, when I find that young men and 
young women can now actually buy the books containing such pagan 
•conceptions of God, I am almost inclined to wish that there were a 
power in society like that arrogated to himself by the Pope, so that these 
fearful causes of infidelity might be put in the Index Expurgatorius, 
and forbidden to those whose minds may be depraved or whose hearts 
may be saddened by them. 

These are examples of what is called religious teaching from the 
creeds, catechisms, or manuals of the five denominations of what are 



382 The Industrial Progress of tJie Nation. 

called Protestant Christians, who outnumber all others in this country, 
even including the Catholics, and who outnuniiber all Protestants among 
that part of the Christian population of the world. Now, if this antique 
and horrible doctrine of original sin and eternal damnation is incor- 
porated in the manuals and catechisms used in what is called the 
religious teaching of children and of youtig men and young women, — 
if such declarations of necessar)^ belief are furnished to clerg^^men to 
be used in preparing their sermons, — then one cannot wonder very 
much at the somewhat irreverent title of the only one of Ingersoll's 
pamphlets that I have ever read, " An Honest God the Noblest Work 
of Man." Nor can one wonder that Islam secures a thousand converts 
from gross Paganism to one secured by a Protestant missionar}^ 

If, on the other hand, — what I believe to be the truth, — these 
formulae are simply a repetition of dead, exhausted superstitions, re- 
printed because men dare not break with old habits and customs, their 
continued publication and sale by the accredited agencies of their 
denominations imply such intellectual dishonesty on the part of their 
leaders as to deprive their representative preachers of any great influ- 
ence. The clergj^men who tolerate the use, but do not believe these 
creeds, may be most excellent, kindly, and benevolent pastors, an aid 
and a comfort to their congregations, but can the)^ be leaders of re- 
ligious thought ? It seems to me impossible. Do they not really 
attain influence only in proportion to their freedom from the influence 
of these dogmas ? 

Objection is made to the introduction of religious teaching in the 
public schools, and a vehement controversy is now going on upon this 
subject, I find my sjonpathy in this connection mainly with the 
Catholics and the Jews rather than with the Protestants. If I were 
forced to choose which influence I would prefer to have prevail in a 
school to which I might be obliged to send a child, I should ver}^ much 
prefer the Catholic treatment of the subject of the future life to the 
•Calvinistic. The conception of purgator}^ imputes less dishonest}^ to 
the Creator than the conception of a perpetual hell ; and I think that 
Catholicism can be more readily adapted to the conditions of modem 
life, and will be more surely modified and purged of that which is bad 
or erroneous, than the religious system of the Calvinist, which is based 
on such a logical method that, if the premises are accepted, the con- 
clusion of necessity ensues, as Calvin reasoned. And this conclusion 
leads directl}' toward atheism rather than toward modification of reli- 
gious conceptions, such as the Catholic Church may adopt and may 
teach. Witness St. George Mivart's two articles in the Nijuteejith 
Century, in which the views of a Catholic scientist of the highest ability 
on evolution and on Biblical criticism are given. It is not only within 
a single generation, or at the utmost vsathin two, that the Unitarian or 



Religion and Life. 383 

rational type of religious belief has been brought to the notice of every- 
day or common people who have not much time to devote to the sub- 
ject ? Is it not the function of the Unitarian to bring the concepts of 
religion into the daily work of men ? If the world and the flesh are in 
their nature bad, corrupt, misleading, and treacherous ; if Scriptural 
texts can be and are perverted so as to condemn worldly prudence, 
foresight, economy, and the accumulation of capital, — as they are, — then 
he who feeds the hungry, clothes the naked, and houses the poor in 
ever increasing abundance, comfort, and welfare is outside the pale of 
faith, outside the performance of good works ; he is but prolonging the 
lives and multiplying the numbers of those who, being " conceived in 
sin and bom in iniquity," must go down to everlasting damnation. 

Now, the very conception of commerce is that of mutual service ; 
yet the very common idea which prevails, especially among the clergy, 
is that in all trade each man is trying to get an advantage over his cus- 
tomer, that in all manufacturing each man is trying to make the poor- 
est substance that will pass the test of the market, that each man will 
cheat his neighbor, adulterate his goods, put on false marks, and mis- 
lead the ignorant and the poor, provided he does n't get found out. 
This conception of commerce is so far from the truth as to be almost 
absurd. 

Yet I do not wonder that the representatives of sects who deal in 
their book-shops in total depravity and eternal punishment at two to 
ten cents per creed should suspect salt in the sugar, sawdust in the 
spice, pipeclay in the cotton, or strychnine in- the beer in which their 
parishioners deal. When men impute to the Almighty motives, 
methods, and acts which, if avowed or applied by any merchant or 
manufacturer to the conduct of his own life, would destroy his credit 
and cause distrust of his character, their 'influence can only be main- 
tained in inverse proportion to the intelligence of those whom they 
undertake to teach. 

I have often had occasion to point out, as others have done before 
me, that fraud, peculation, and dishonesty in trade are conspicuous 
because they are not common. What were the number of dishonest 
transactions to-day compared to the number of opportunities for theft, 
fraud, and cheating? What is the best and most profitable account on 
the manufacturer's or merchant's books ? It may be and often is the 
guaranty account, /. e., the sum charged to the cost of goods and 
credited to guarant)-, to protect the merchant against bad debts. My 
father was a merchant for over forty years, dealing with men during the 
period when capital was scarce and credits were given on almost all 
transactions. Yet he told me that the losses by bad debts which he 
had made through his business ca/eer would not come to fifty cents or. 
each one hundred dollars' worth of goods sold. My business experi- 



,384 The Industrial Progress of the Nation. 

ence began forty-six years ago, when the customary credit on domestic 
cotton fabrics was eight months, and on woolen fabrics ten, sometimes 
twelve, months. Before the railway had sunk time and distance in a 
fraction of a cent a ton a mile for the cost of moving the goods, the 
necessities of the work of distribution required long credit to be given. 
From that time to the present I have been personally connected with 
factories whose sales have amounted to at least a hundred million dol- 
lars' worth first and last ; and I can safely say that the losses by bad 
debts throughout this period on the aggregate of these transactions 
have not exceeded fifty cents, and would probably be less than twenty- 
five cents, on each one hundred dollars' worth of goods sold. The fac- 
tories, workshops, and warehouses on which the company of which I 
am president now carries ninety million dollars of insurance, and, in 
connection with other companies of like kind, organized in a mutual 
association for mutual service to the manufacturers, have outstanding 
policies in all to the amount of four hundred and fifty million dollars. 
In the next twelve months the value of the goods and wares which will 
be turned out by these establishments will be more than eight hundred 
million dollars. In my judgment, if the owners of these establishments 
would pay any guaranty company one half of one per cent., fifty cents 
on each one hundred dollars, or four million dollars, to guarantee the 
prompt payment of the eight hundred million dollars when due, the 
profit in that transaction would be one half that sum, or two million 
dollars. What inference as to the character of the community is to be 
drawn from these facts ?" 

If the great mass of men did not on the whole intend to live fairly 
and to deal fairly with others, no commerce would be possible on any 
large scale. In proportion as the law of mutual service is wittingly or 
unwittingly applied does the service increase with corresponding welfare 
to each and all. 

In my own experience, I have observed that the best goods of every 
kind, whether high-priced or low-priced, of which the quality is main- 
tained uniformly through a long term of years, yield the best profit to 
the manufacturer 

Another rather curious result is this : that when the reputation of 
any given class of goods is thoroughly established on its name or trade- 
mark, the middle-man or dealer can secure but the least margin of 
profit from its sale. 

On the other hand, goods which are badly made, adulterated, or 
which depend upon mere fashion or fancy for their sale, last but a 
little while, and are dangerous to all who touch them. The skill of the 
dealer is in meeting the fashion and in rightly estimating the time in 
which a given fancy or fashion may last, and in getting a big profit on 
the first sales to cover the possible loss on the stock left when the 
fashion changes. 



Religion and Life. 385 

In making the broad statement that the law of commerce is, on the 
whole, one of mutual service, subject only to such exceptions as 
strengthen the rule, I do not ignore the enormous sales of quack medi- 
cines, perhaps the most obnoxious, immoral, and even wicked method 
of raising money on the pretence of service. But herein, again, comes 
the necessity for raising the standard of individual intelligence. In this 
matter, as in speculating in Wall Street, there would be no wolves to 
shear the lambs if the lambs did not bring their own fleeces to be 
shorn. If people would not ignorantly dose themselves or ignorantly 
buy quack medicine in order to take alcoholic stimulants in disguise, 
the traffic in quack medicines would not pay. It implies a knave on 
one side and a fool on the other, because it always takes two to make 
a bargain. That is to say, it is only people who are very credulous 
in respect to matters on which they are uninformed who are cheated or 
misled in their purchases of any thing ; but, in this matter of trade, all 
that is necessary is to find out what is the character of the maker or 
the dealer of whom you buy, and then you need not give a thought to 
the quality of the goods you buy : they are sure to be as good as the 
price you are willing to pay will permit. How curiously perverted 
words become in use I We talk about bargains. Now, if you attempt 
to bar a reasonable gain for the service rendered by the dealer of whom 
you buy, you will be sure to be cheated in the long run, because you 
covet what he ought to gain. 

The whole countr}- is now agitated by different phases of what is 
called the " labor question," and there has never been a period in the 
history of any country when so much attention has been given to the 
study of the forces which make for material abundance and human 
welfare. There are all sorts of empirical devices for improving the 
standard of living; but to every one who brings to this subject an 
honest mind it soon becomes apparent that the only way to raise the 
general standard of living and to benefit the community as a whole is 
to develop the personal character and capacity of each and ever}' 
indi\ddual member of the community to a yet higher plane. The 
primary source of all wealth is in the manual and mechanical work 
which is done by the many under the direction — not control but 
leadership — of the few, by whom all are serv'ed alike. It is as true that 
capital is placed at the service of labor by the capitalist as it is that 
labor ser\-es capital in the production of commodities. There never 
was a time when science and invention had placed such opportunities 
in the way of young men and young women to live well as at the pres- 
ent time. But the stream cannot rise higher than its source ; and if 
many remain ignorant and incapable of taking advantage of the oppor- 
tunities which science and invention have placed at their disposal for 
developing the products of our mother earth, then even a low standard 
of subsistence may with difficultv be attained, and the hardships to 

2S 



386 The Industrial Prog7'ess of tJie Nation. 

which the many are subjected will continue to be imposed upon them 
by their ovra. incapacity. 

The mind of man is the important factor in material production. 
Character counts for more than capital in getting a living. He makes 
the best use of his capital who by the use either of his brains or his 
capital, while serving himself, at the same time raises the earnings of 
the workmen to the highest point by reducing the cost of production 
to the lowest ; and that is the law of progress. The dollars of the 
gain which the capitalist earns under these conditions are but a tithe of 
the ser\-ice which he renders to all ; he may benefit his fellow-men 
vastly more in the getting of his fortune or the gaining of his wealth 
than he possibly can in the spending or disposing of it even for chari- 
table purposes. 

But the work in which the business man is occupied, although it is 
in using the things of the world and in pro^'iding for the flesh, is yet 
fully justified, and its beneficence is acknowledged. One may say : 
*' All this is but a part of the estimation in which men of affairs are now 
held by Catholic and Protestant, by Cah-inist and Unitarian, b^' Deist 
and Atheist alike." But is it so ? Is this view of the world and of the 
material doings of men. which are symbolized as " the flesh " in the 
text, consistent with the creeds by which the world is condemned and 
all things in it, and in which it is held that the life of man is misspent 
unless it is devoted to a little, petty, selfish undertaking for saving his 
own soul. — a matter about which he need not worry himself in the 
slightest measure, if he does what is given him to do in this world as 
well as he knows how to do it ? 

The hardships and trials of life may hide from us much that it 
would be helpful to know ; yet is there not in every man a spark of 
that inspiration, however dim, which may lighten the way and may 
bear witness to the life that is beyond? 

" The one remains ; the many change and pass. 
Heaven's light forever shines, earth's shadows fly. 
Life, like a dome of many-colored glass. 
Stains the white radiance of eternity, 
Until death comes and shatters it to fragments." 

^Miy the work of life should be so hard, we cannot telL What it must 
have been before the inventions of science had lightened the work we 
cannot imagine. This much we do know : that by patient, honest 
work the character is formed and capacity is developed. We know 
that the old Hebrew myth, that labor is a curse imposed upon man 
because of his sin, has no foundation. We know that work is a benefi- 
cent necessity, through which men are brought under the healthy 
stimulus of prospective want to the highest plane which their time and 
opportunity in this world will permit. We know that the functions of 



Religion and Life. 387 

men of affairs are of the utmost beneficence, even though their work 
pertains to matters of the world and of the flesh. 

I suppose each man's conception of his relation to the eternal, 
which must be the foundation of all religion, will vary according to the 
individual development of the man himself. Many may be aided by 
forms and symbols which to others convey no meaning. What matter ? 
If the conception of religion is true and honest, the life will corre- 
spond ; if the conception of God implies a power exerted in a mean 
and unjustifiable manner, then the life may correspond to that type of 
what is called religious, and may be very ignoble. To my own mind 
there is something very obnoxious and repellant in the common sepa- 
ration of religion from life, which is implied in the theory of sudden 
conversion or of revivals ; yet more in the ordinary forms of exhorta- 
tion, by which it is implied that all men must be sinners until they 
shall be saved in a particular way. Is it not, in nine cases out of ten, 
either an act of unconscious hypocrisy or of intellectual dishonesty 
when men apply to themselves in their attitude toward their Creator 
terms which they would resent with the utmost indignation if they were 
applied to them by others ? I do not think common forms of religion 
will either gain or retain a strong hold upon men who have passed be- 
yond the phase of superstition, so long as its terminology differs so 
much as it commonly does from the phrases, forms of speech, and 
tones or inflections of the voice which are used in every-day life. It is 
for these reasons that, while I have never felt called upon to join any 
particular church or to become any thing more than a member of a 
Unitarian parish, I look upon the ideas which are symbolized under 
the name of Unitarian as being necessary to the progress both of 
mental and of material welfare throughout the world. 

The open secret which few yet seem to comprehend, although all 
act consistently with it unless restricted in their individual liberty, is 
that not only individual wealth, but the common welfare of States and 
Nations, is attained in most ample measure through interdependence, 
and not through independence. The higher law on which modem 
society is founded is that of mutual service. 

Those who apply reason to the conceptions of religion may fully 
attain the leadership which they are rapidly gaining, and to which they 
are entitled in all sects and denominations by joining religion and life, 
which have been so widely separated in creed and practice heretofore. 
The basis of faith will be found in the recognition of the fact that 
there is a law of harmony in the universe, ultimately controlling the 
relations of men to each other under the conditions of mutual service, 
as truly as the planets in their courses are bound by the supreme law 
which is becoming more and more within the knowledge and compre- 
hension of men as science is more and more developed. 



388 The Industrial Progress of the Nation. 

As time goes on I think it cannot fail to become a part of the com- 
mon economic faith that all the forces which make the rate of wages or 
the margin of profit, and which control commerce among men, tend to 
remove the more noxious and degrading conditions from the work ; to 
lessen the necessity of unduly hard work in mechanical and manual 
labor ; to secure to the workmen a constantly increasing share of an 
increasing product ; and to diminish the number of drones who live on 
the proceeds of others' labor without doing any service in return. It 
is also possible that within two or three generations the old economic 
dogma, which is in its place as vicious as the bad creeds from which I 
have quoted, and perhaps more harmful in its effect upon the material 
conditions of men than these old pseudo-religious creeds now are in 
their effect upon spiritual conditions, — namely, that in all commerce 
what one gains another must lose, — may be displaced by the righteous 
conception that in all commerce, whether between men of the same nation 
or with other nations, both parties gain, and that commerce exists simply by 
the force of the mutual service which is wittingly or unwittingly rendered 
by every man who buys and sells and gets gain, dealing honestly in whole- 
some goods and wares. When this economic faith is joined to a true 
spiritual insight, then, indeed, all the forces by which human action is 
guided and controlled will work together for peace, order, industry, 
good-will, and plenty among the nations. Then may the vision of the 
poet become indeed a living truth : — 

" Down the dark future through long generations 
The echoing sounds grow fainter and then cease ; 
And like a bell, with solemn, sweet vibrations, 
I hear once more the voice of Christ say, ' Peace.' 

" Peace ; and no longer from its brazen portals 

The blast of war's great organ shakes the skies ; 
But, beautiful as songs of the immortals, 
The holy melodies of love arise." 

My friends, this is an age of freedom. We have attained personal 
liberty, freedom of thought, freedom of action : we may yet attain 
freedom of commerce in the broadest sense, in which all men may 
serve one another. May we not find in these conditions that faith 
which is " the substance of things hoped for, the evidence of things not 
seen " ? If this is not so, — 

' ' Of what avail the plough and sail. 
Or land, or life, if freedom fail ? " 



INDEX 



INDEX. 



Acreage, population and debt in ratio to, 

84 
Agriculture, extensive, objections to, 208 ; 

intensive, advantages of, 208 
Alabama, production of iron, 20 
Amoskeag Manufacturing Co., model 

factory, 322 
Anarchists, in typical township, 223 
Andover Theological Seminary, 379 
Andrew, Governor John A., wise advice, 

28 
Annual product, how valued, 144 
Architect, profession of, how it may be 

raised, 334 
Architecture, combustible, cost of, 310 ; 

examples of, 313 
Armies, ratio of exempts to service in, 86 ; 

source of weakness, 96 
Atwater, Wm. O., soda laboratory, 159 



B 



Banking, margin of profit, 230 ; support 
of, a test of intelligence, 230 

Barrett, F. N., estimate liquor consump- 
tion, 180 

Bastiat, Frederic, Harmonies, 299 ; rela- 
tion of wages to capital, 263 ; works 
incomplete but suggestive, 11 

Eayard, Secretary, Thomas F. , instruc- 
tions to consuls, 90 

Bones, dry, or otherwise, 97 

Boot-blacks, how they add to wealth, 153 

Boston, city of, taxation of, 362 ; distribu- 
tion of taxes, 226 

Bread, cost of distribution, 223 ; heat re- 
quired, 345 



■Cairnes, J. E., law of wages, 9 
Calories, standard of nutrition, 340 
•Canada, no guard against, 16 ; repelled 

by petty taxes, 16 ; mischief of tariff on 

products, 235 
Canadians in factories, work and wages, 

193 



Capacity, to him that hath shall be given, 
91 ; to produce in inverse proportion to 
land occupied, 363 ; mental, prime fac- 
tor in production, 353 

Capital and labor, shares of product, 305 

Capitalist, adds more than he earns, iv 

Capital, serves labor by increase of pro- 
duct, 147 ; never exceeds two or three 
years' product, 198 ; no power of com- 
pulsion, 242 ; how saved, 299 ; labor 
helpless without, 358 ; national, pro- 
portion to product, 302 

Carey, Henry C, reductio ad ahsurdum, 
82 ; on wages and capital, 299 ; rela- 
tion of wages to capital, 263 

Carolina, South, needed manure not seces- 
sion, 15 

Cents, fifty, a day per capita, how to add 
the test of reform, 220 ; five, per day, 
profit or loss, 202 

Century, nineteenth, what has been done, 
28 ; twentieth, what will be done, 28 

Character counts more than capital, 246, 
386 

Chicopee Manufacturing Co., model fac- 
tory, 323 

China, how we trade with her, 217 

Churches annually burned, 313 

Classes, privileged, what will they do for 
a living, 97 

Clothing, equality of, 242 ; standard of, 
104 

College buildings and libraries annually 
burned, 313 

Combination leads to abundance, 6 

Comfort, how attained, 248 

Commerce, alphabet of, 217 ; law of, 
mutual service, 385 ; supreme law, 388 

Common-sense, more potent than Con- 
gress, 244 ; ultimate guide to reform, 

243 
Communists few and feeble, 224 
Competition leads to abundance, iv 
Conditions of men, three methods of im- 
proving, 292 
Congress, debates in,, mostly examples of 

unintelligent mediocrity, 271 
Construction, how to make safe, 312 ; slow 
burning, 309 



391 



192 



Index. 



Consumption limited, production unlim- 
ited, 6 

Consumption, measure of, 293 ; five modes 
of, 295 ; graphically illustrated, 296 

Cookery, domestic, first place in reform, 
240 

Cooking, bad, prime cause of poverty, 
239 ; waste in, 239 ; experiments in, 

341 
Cooking Box, Norwegian, developed, 343 
Co-operation, why not if you want to ? 

229 
Cost low, wages high, reasons for, 129 
Cotton, consumption per capita, 339 ; 

cheap, by free labor, 19 ; condition of 

supply, 18 ; free and slave product, 65 ; 

product of, compared by periods, 65 
Cotton fabrics, exchange of, with China, 

26 
Cotton fibre, why the South controls, 18 
Cotton seed, importance of, 19 
Credit, effect on prices, 237 
Creeds, antique and horrible, 380 ; prices 

of, 380 ; value inverse to price, 380 
Creed, work out your own, 11 ; Catholic, 

honest at least, 382 
Cuba, deposits of iron, 288 
Currency, per capita, 187 ; prices and 

wages compared, 188 
Custom-houses not inconsistent with free 

trade, 366 



D 



Debts, bad, insignificant compared to 
payments, 383 ; European and United 
States, 85 
Devil, not always in the flesh, 379 
Disarm or starve, the warning of iiberty. 

Dismal science, political economy not a, 3 
Distribution, the main question, 18 ; un- 
equal, becomes equitable, iv 
Dogma not necessary to faith, 380 
Domain, national, proportion in crops, 41 
Domestic industry, how to promote, 282 
Drink, consumption of, 180 ; cost per 

year, 39 
Dutch, sources of power and wealth, 17 
Dwelling-place, how to equalize, 243 
Dynasties, doomed, 92 ; how will they get 
a living, when a settlement of accounts 
has been called ? 97' 



E 



Earth's capacity not touched, iii 
Economic science in U. S., true leaders 

in, 10 
Eggs, value of, compared to iron, wool, 

and silver, 37 
Egypt despoiled by debt, 93 
Eight-hour dream may become reality, 

178 
Emancipation of white man, 244 



English-speaking people, trade union of, 
267 

Ensilage, importance of, 15 

Enthusiast, crack-brained, may be true 
prophet, 266 

Euclid, none in economics, 10 

Europe, a prey to fear, 207 ; division and 
dissension in, 48 

Everett, Dr. Wm., old aphorism in new 
form, 2 ; modern aphorism, 379 

Exports, must balance imports, 232 ; 
number dependent upon, 45 ; occupa- 
tions resting upon, 233 



Factory building, old style, 312 

Faith, basis of, 387 

Farmer, choice of subjects of taxation, 365 

Farmer's daughters, hours of work and 
wages, 193 

Farms, number and how occupied, 44 

Felon, unconvicted, must run a railway 
beneficially, 377 

Fiat money, fraud, 182 

Field, Marshall, model warehouse, 315 

Financial danger avoided, 185 

Fire-door, automatic, 332 

Fii-e losses, fault of owners, 311 

Fisheries, failure of treaty, 81 

Fishery question, discussion of, a national 
humiliation, 236 

Fish, taxation of, a ridiculous absurdity, 
236 

Food, basis of morality, 379 ; measure 
of, 340 ; within one year of exhaustion, 
303 ; equal consumption, 242 ; relative 
cost of, 114 ; cost per year, total, 37 ;. 
standard ration, 103 ; providers, 122 

Foreign population in Massachusetts, 17 

Free trade, continental system, 244 ; ob- 
jective point of all, 253 ; test of, 232 

Frying-pan, infernal machine, 342 

Fuel, cost for cooking, one year, 344 



G 



Gannett, Henry, estimate of wealth, 301 
Garfield, President, clear conceptions of,. 

II 
George, Henry, sincere but fallacious,, 

351 ; fallacies of, 10 
German, farmer and peasant, expenses,. 

46, 47 
Gold and silver, product compared, 1 16 
Government, cost of, 364 
Grain, product per capita, 62 ; crops of^ 

compared by periods, 61 ; average prod^ 

uct, 1865-1885, 33 
Grant, President, stopped inflation, 244 
Great Britain, basis of power, 265 
Grecian order of society, restoration not 

desirable, 268 
Gumption should be taught, 21 
Gunpowder equalized forces, 207 



Index. 



393 



H 



Hawley, F. B., method of increasing 

wealth, 153 
Hay, product compared by periods, 63 
Heat, measure for good cooking, 345 
Hell, unholy flames of, 381 
Hospitals, annually burned, 313 ; whited 

sepulchres w511 devised for cremation of 

inmates, 329 
Hotels annually burned, 313 
Hours shortened, 193 



I 



Imports, how diverted, 45 ; 1881-1885, 
quality of, 76 ; of typical township, 
214 ; quality of, 234; what should be 
taxed, 284 ; sources of revenue, 286 

Incapacity, political, probable in Con- 
gress of 1889, 84 

Income, measure of, 355 

Incomes of rich, how consume , 294 

Industrial intelligence, in all commerce 
men serve each other, iii 

Inflation, veto of bill, 244 

Insurance, fire, progress of, 309 ; life, 
gain in, 69 

Interdependence, peace, order, and in- 
dustry, iii ; the rule of nations, 267 

Interest, fall in rate, 172 

Intoxicants, revenue from, 365 

Inventors, destructive work of, 221 

Iron and steel, cost of protection to, 257; 
cost of taxation on, 278 ; final cost of 
protection, 287 ; foundation metals, 
257 ; how to protect, 2S8 ; occupied in 
production, 257 ; production and con- 
sumption U. S., 274; relative con- 
sumption U. S., 257 ; relative prices 
Great Britain and U. S., 276 

Iron, an insignificant product, even in 
Pennsylvania, 281 ; cheap production, 
5 ; disparity in price, 64 ; labor-cost of, 
288 ; production a necessity, 260 ; pro- 
duction unimportant, 20 ; product of, 
compared by periods, 64 

Iron, bar, prices compared, 2S7 

Iron ores, dependence of Great Britain, 
277 

J 
Jurist, highest profession, 2 



Kings, dukes, and lords, superfluous, 206 
L 

Labor and capital, shares of product, 305 
Labor, capital inert without, 358 ; claims 

of, must be considered, 207 ; relieved 

by inventions, 193 
Laborers, German, enemies of, 46 



Laissez faire — laissez passer, not a fixed 
rule, 6 

Land, choice of position valued, 360 ; de- 
velopment by railways, 305 ; exhausted 
when treated as a mine, 1 58 ; possession 
more easy than ever, 304 ; possession 
necessary to use, 359 ; raw, has no 
value, 225 ; single tax, fallacy of, 227 ; 
single tax, ill effects of, 226 ; single tax 
treated, 350 ; valuation, in typical 
township, 212 

Law, higher, ample subsistence for all, 
iii 

Legislation on fisheries, integrity justified 
at the cost of intelligence, 81 

Liberty, cost of, 183 ; individual, sole 
condition of welfare, 5 ; price of, 78 ; 

Life, a conversion of forces, 240-; curves 
of, 70 ; enjoyment of, v. ; human, pur- 
pose of, iii ; price of, 200 ; three phases, 
material, mental, and spiritual, 3 

Living, cost of, proportion of product ex- 
pended, 293 

Loan, forced, paper money redeemed, 

Louisiana, purchase of, changed course of 

history, 82 
Luxury, how much, on 50 cts. a day, 213 



M 



Maine, Sir Henry, trust in humanity, 377 
Malthus, fallacies of, 7 ; influence of, 9 ; 

hypothesis of, 156 
Man, American, not deteriorated, 23 ; 

Southern, bigger waists, reason of, 23 
Mankind, as lazy as it dares to be, 216 
Manufactures, household, 211 
Materials, crude or raw, free of taxation, 

234 
McBryde, Pres't J. J., studies in ensilage, 

15 
McCulloch, Hugh, estimated maximum 

United States debt, 75 
Meat boiled is meat spoiled, 343 
Millions, five hundred, cost of taxes on 

iron, 287 
Mind and character, prime factors ia 

production, iii 
Mind of man, prime factor in production, I 
Miracle of the loaf, 14 
Missing science, coctor non doctor, 339 
Mivart, St. George, criticism, 382 
Model mill, one-story structure, 327 
Money, cheap, a delusion, 236 ; circula- 
tion in typical township, 221 ; in cir- 
culation per capita, 187 ; in circulation, 
prices and wages compared, 18S ; not 
quantity but quality, 189 ; quality- 
good, quantity will take care of itself, 
221 
Mortgage, shall one generation bind 

another? 97 
Multiple standard, application of, 170 
Myth, Hebrew, labor a curse, 386 



394 



Index. 



N 



Nation, ability to bear taxation, iii 
National domain, compared with Europe, 

55 
Nations, strength of, 53 ; weakness of, 

80 
Needful, one thing, 175 
New England, secret of, 22 
Nitrogen, importance of, 4 ; whence, 14 
Nobility, Chinese titles approved, 206 
Nutrients, must be equally supplied, 291 ; 

necessary proportions of, 340 



O 



Octrrtpations, in iron and steel, 257 ; in 
typical township, 210 ; of people ana- 
lyzed, 204 ; rest on individual capacity, 
129 

One-story mill, plan of, 324 

Ores, iron, abundance in North America, 
277 ; fine ore becoming scarce in Great 
Britain, 277 

Oven, description of paper oven, 341 



Pauper labor, cause of, 49 ; under-fed, 
therefore ineffectual, 177 

Peace, vigorous prosecution of, 28 

Penalties of progress, displacement of la- 
bor, 113 

Pennsylvania, blunders of, 280 

Phases of life, material, mental, and spirit- 
ual, 3 

Physiocrats, theory of land, 351 

Plymouth Cordage Co., model one-story 
mill, 327 

Political economy, moral and ethical 
aspect, 264 

Population, Europe and United States, 
55 i growth of, not yet comprehended, 

13 
Population of United States, compared by 

periods, 57 
Pork, waste of grain, 109 
Potato gospel allied to spiritual, 2 
Poverty, Anti-, societies obscure the ques- 
tion, 351 
Poverty, removed only by self-help, 3 
Power, productive, in what does it con- 
sist, 353 
Price, disparity a disadvantage, 256 
Prices, fall in, 115 

Privilege, domination of, stops progress, 3 
Product, average, per workman, 200 ; how 
valued, 140 ; per capita, compared, 88 ; 
annual, in typical township, 213 
Production, causes of variation in, 88 ; re- 
lative to taxation, 92 
Products, how distributed, 292 
Profit, margin of, diminishing, 126 
Profit sharing, is it profitable ? 230 
Progress from poverty, 130, 163 



Prohibition, effect on industry, 237 
Property insured against fire, 310 
Property, possession rests on service, 201 ; 

private, how developed, 358 
Protection, advocates of, sincere, 255 ; test 
of, 231 ; M'ith incidental revenue, advo- 
cated by the feeble-minded, 253 
Protective system, modify carefully, 256 
Protective tariff, protest against, William 
Gray, Abbott Lawrence, and others, 261 
Protective theory, basis of, 254 
Provisions, cost of moving, 1865 and 1885, 

34 
Pulse necessary with rice, 342 



Q 



Quarrel with Canada due to stupidity and 

greed, 236 
Quesnay preceded Henry George, 351 



R 



Railway, miles of, compared by periods, 

58 
Railways, charges per miles, 58 
Ration, daily, analyzed, 35 
Relief, cannot be given, must be earned, 3 
Religion and life, connection of, 377 
Rent, judicial, failure in Ireland, 227 
Restrictions on labor, bad effect of, 177 
Revenue, how to reduce, 283 
Revolution, war of, caused by ' an eco- 
nomic blunder, 7 
Ricardo, fallacies of, 8 ; hypothesis of, 

156 ; influence of, 9 
Rice-fed races, none such, 342 
Rich, ameliorate the condition of, 248 
Richardson, H. H., architect, methods of, 

314 
Roman empire, relics of, 220 
Roof, bad forms, 319 ; true roof specified, 

328 ; factory, safe form, devised by W. 

B. Whiting, 320 ; purpose of, 314 
Roofs, crazy, description of, 314 
Rumford, Count, experiments of, 343 



Salvation, work out your own, 11 

Sam, Uncle, gain in power of production, 

194 
Sausage, German, beat the French rifle, 49 
Savings banks of Massachusetts, gain in 

deposits, 73 
Scab, a future title to honor and credit, 

245 

School, common, solvent of race, creed, 
and condition, 62 

Secret, the open, interdependence not in- 
dependence, 246 

Senators, New England, historic rubbish 
on fisheries, 81 

Service, mutual, developed most fully ia 
United States, 161 



Index. 



395 



Shakers, logical method of, 224 

Shelter, how to provide more rooms, 243 

Ships weave a web of concord, 378 

Silver and gold, prodiict compared, 116 

Silver question treated, 115 

Single tax, effect of, 301 ; would concen- 
trate land in fewer hands, 373 

Slavery destroyed itself, 244 

Smith, Adam, method of, 7 

Socialists, abortive efforts of, 223 ; Ger- 
man state, have misled young students, 9 

Social science, experimental, 10 

Soul developed by work, 3 

South Carolina University, 29 

Southern States, economic blunders, 281 

South, industrial progress. iS ; new, re- 
sources of, 5 

Specie payment, how resumed, 124 

Standard, multiple, 167 

Statistical investigation, true importance 
of, v 

Statistics, importance of, 161 

Stewart, William P., actuary, curves of 
life, 69 

Strikes, failure of, 139 

Subsistence, sources of, 13 

Sunny South, resources of, 4 

Survival of intelligent and capable, 13 

Swank, James M., adjustment of figures 
on iron, 287 ; authority on iron, 260 ; 
cited on prices of iron, 287 ; labor-cost 
of iron, 288 



Tariff reform, project for, 286 
Taxation, a form of consumption, 296 ; 
at what point to tax, 362 ; limit reached 
in France, 93 ; means work, 352 ; ratio 
to product, 303 ; relative burden of, 
83 ; relative to production, 92 ; succes- 
sion approved, 355 ; voluntary in part, 
374 
Taxes, in typical township, 215 
Tax, single, on land, 225 ; merits of, 374 ; 

no novelty, 227 
Theory and practice, wolrkmen's com- 
ments, 247 
Time, the only common property, 50 
Tin plates, what we buy them with, 259 ; 

cost of protection to, 258 
Township, typical, 6,ocx) people, 2og 
Trade, foreign, balance wheel, 233 
Treaty on fisheries, discreditable debate, 

81 
Tropical conditions, not conducive to 
progress, 4 



Trust, perversion of, by railway president, 

378 
Turgot applied Quesnay's theories, 351 



U 



Unitarian ideas symbolized, 387 
Unlearned professors, equal standing, i 

V 

Vanderbilt, the great communist, 207 

W 

Wages, each man makes his own rate, iv ; 
gain by classes, 72 ; gain in power, 112 ; 
gain in purchasing power, 106, 169 ; 
high — cost low, explanation of paradox, 
90 ; high rates, and low cost of work, 
90 ; how increased, 137 ; iron law, so- 
called, 162 ; low and high cost of labor, 
218 ; raised while cost is reduced, 222 ; 
rate increased, cost reduced, 132 ; what 
makes rates high, 89 ; what makes the 
rate of, 143 
War, Civil, fruits of, 29 ; cost of, 182 ; 

labor expended in, 183 
War of Revolution, cause of, 67 
Waste, rich and poor compared, 217, 298 
Wealth and population, relative gain, 118 
Wealth, measure of, 149 ; natural analy- 
sis of, 300 ; progress in, 66 
Webster, Daniel, a true prophet, 271 ; 
argument for free trade, 263 ; objec- 
tions to protection, 261 
Webster, Pelatiah, riches of a nation, 53 ; 
Welfare, material, cause of, in U. S., 77 
Wells, David A., researches on iron, 273 
What are you going to do about it ? 203 
Weeks, Joseph D., authority for wages 

and prices, 104 
Wheat, production in California, 13 ; 
product in Dakota, 44 ; relative cost 
U. S. and Germany, 47 
Whigs, cotton, blunders of, 282 
Wool, consumption per capita, 339 ; 

effect of duties on, 258 
Wordsworth, quotation from, 30 
Workman, income, how spent, 241 
Workmen's rejoinder, 248 
Work of life, one half for food, 4 
World and flesh, not so bad as they 

seem, 383 
World, the best that could be made, 2 
Wright, Commissioner, C. D., food statis- 
tics, 164 




m 








s 


B 




^s 


•^JS 



s 


^^^p1l^\ 



m 



m. 











7^? 



-M 






jy^- 




rr' »«>StI^ 









^iLlilllltR^ 



LIBRARY OF CONGRESS 




013 722 224 3 




